Variety (Aug 1936)

Wedbaesday, August 5, 1936 PICT ES VARiETY^ IG-20TH-GB DEAL NOT COLD Sid Kent s Bonus-Plus Deal Tops 20tli-Fox; Zanuck, Schenck Next ■ — : , . Washington," Aug. 4. . Fat-salary, cpntracts ot 2Qth. Ceil- ^fiiry-Fbx's big: three executives came , V tO;light again Monday (2); when -the 'u. securities and ExchangeI'Conunission^ ■ denied' request-to §eial portion ' of J Registration ."statement, covering em- V^ vifloyees' cqmpensatioiii . Biggest " Tffeekly pay-envelop* goes .to. tiarryl F.. Zanuck, although gross compen- sation of Sidney R. Kent tops the Topter. Joseph M. Schenck trails Zanuck Is third high^st-^paid. [All of ttie executive arrangements were made public ^nd submitted' to' stock- holders .arouiid a year ago in ac- cordancje with the merger plan then ?Aiiftefed. There is nothing new about this.] ; With a seven-year contract pro- ; tecting. each of the trio, Kent enjoys biggest cut in . view of generoiis ■ bonus agreement and salary from ' .subsidiary company. In addition, he ; has a stock-purchase agreement per- . ihittlng him to get in on the groimd floor at any time during the life of ". the document. Guaranteed a salary of $2,500 ■ 'Weddy, Kent also is to receive $50,- OOQ- on. each !Dec. 31 in addition to a .payment of $75,000 on Nov. 1, 1935. He is aUowed $200 weekly for entertainment expenses, and his $25,000. salary as president of Nai- . tlonal Theatres is guaranteed by the itarent firm. His contracts contain the right to buy 60,000 shares of com- mon stock at the rate of 10,000 per year at a price averaging the stock :.:^j|nacket tag-.during the first 90 days /J^:aft?!r Usting biit not under $10 per ^ shafe. In the event of death, the YcSWtltt ptitdiase' option must' be ex- ^ .r^f cised Vithih three months by his • " executor. . Obtaining no. stock concessions, Zanuck and Schencfc were satisfied with straight saWry agreements^ Zanuck's weekly stint brings him $5,'000, while Schenck gets half this amount. Geo. White's Original Pact At the same time these contracts ^ were disclosed, S. E;-C. took lid'off y- the final report before reorganization .: and revealed details of othfer smaller contracts which apparently still run. Biggest other agreement revealed 'was one with George White, entered Sept 30, 1933, calling for production ■ of. an annual musical for the suc- ceeding five years. For this White is to-'drag down 10% of the first $ljOOO,000 gross, 15% of the next • $500,000 and 20% of all over $1,500,'- ' 000. (Since then White has left the -■company.) !" The final report showed Kent col- • Jected $191,460 during the last year merger; W: C. Michel took $36,818; Sydney Towell, $21,890, and ■ Wmfleld R. Sheehan, 4300,000. ' « P^''^ sisven. officers, includ- ing Treasurer ToweU, $71,070; 11 em- plpyees, including Kent, Schenck and Tpwell, $493,518, and 74 other em- •- Pioyees, including directors and ac- • tors, as well as Sheehan, $4,527,198. : DR. QANNINI SEEKING BEVHILIS OFFICE SITE :.) . Hollywood, Aug. 4. Headquarters of Dr. A. H. Gian- ,. nmi, president of United Arti<-ts. wUl Ds moved from the UA studio to Beverly Hills around Sept. 1, Cur- rently he is looking for a location to erect an executive building where *u housed. Giannini figures offices should be away from xne .studio as he is not actively en- vA?^ wproduction and wants to de- vote his entire time to his executive outies. ..^^JJe. contemplates a trip to New " •' , V . September where he i yj^U.quarter at the home office of uA for about six weeks. Briton Korda London, July 29. Alexander Korda, who applied for naturalization about 18 months ago, oecomes a British subject during August. Executive is the first,of the nbn- native film section here to take the Plungfe, He's of Hungarian birth. Fitelson with Alperson On GN-BIP Intl Hookups William , Fitelson,' attorney, sailed for London to inaugurate a deal for production and distribution between British International Picts (London) and Grand National Films (N. Y.). Edward Alperson,.GN prez, preceded him abroad. BIP had a distribution deal with First Division, GN'S preceptor, which has run out, although still having several films to go. It Was strict^ a retroactive distribution idea. Prob- able that the new deal to be made now will be along the same lines, although there. is a further possi- bility that Alperson will align his company with BIP'in some British production also, sending over some talent for work abroad, etc. Otterson Settlement Terms Reported at $200,0# Plus Fees While Paramoimt promised John E. Otterson it would not divulge the amount , of the settlement of his con- tract, having four years to go, it isn't unexpected that . stoclcholders win want to know the figure the same as they d^anded to see the Joseph P. Kennedy report since it was costing around $90,000. It's reported at around $200,000 plus attornejrs' fees. Executive opinion in Par is that stockholders could- force the com- pany's hand with respect to the Ot- terson settlement, but that m the ab- sence of such action, the directors and others in the know, insist they will keep their promise to Otterson. Latter made this a condition of the settlement Barney Balaban has taken over the specious suite recently vacated by Otterson in ParamQunt's home office at New York. The former president spent around $75,000 entirely redec- orating the offices, and installing a cooling system. Lasky, Alperson Abroad Jesse L. Lasky sailed from Quebec Aug. i for brief vacation in Europe. Producer plans to return to Hollyr wood latter. part of this month to preview 'The World is Mine' which is being edited by Rouben Mamou- lian. Ed Alperson, prcz of Grand Na- tional, on. the same boat. A iiL.e r i c a n End Enthuses About'General Setup De- spite British Factions Deprecating Alleged U. S. 'Cohtror--Schenck Abroad TAKE 2-3 WEEKS Hollywood, An;. 4. Joe . Schenck lesvei here to- morrow (Wednesday) tor N. T., ..to sail for London on the Gan- mont^Brltlsh deaL Film execntive dismisses any reports anent a hitch of the GB- 20th Century-Fox-Hetro deal. Wall Street indications are that the current talk, emanating tsom abroad about the Metro-20th Cehtuiy-Gau- mont deal being off, is premature. Whettier the purposes of the present negotiations among the compaiiies are to be affirmed, or cancelled de- pends on the findings on the Gau- mont-British situation to be made by accountants . and attorneys for the American companies, now looking into the London company's setup. . The chances are that at least two or three weeks may transpire before such findings shall have been ana- lyzed thoroughly by the Amerldan firms. Presently in London and repre- senting Metro in the matter is J. Robert Rubin, vice-president and general, counsel of the American firm. Representing 20th Centuiy- Fox, in London, at present, and sent from New York, is Richard DWight, head of Hughes, Schurman & Dwight, general coimsel for 20th Century-Fox. The American accountants in the London situation are Price, Water- house & Co. There is no denying that consid- erable enthusiasm-for the deal as it stands is to be found at Metro. $4,000,000 in Cash Metro's end of the deal as ar- ranged, thus far, is for that company to expend $4,000,000 for an amount of G-B stock, from'the 20th Century- Fox and the Ostrer brothers' hold- ings, sufficient to equalize the Metro company's desired holdings in G-B, with those of 2()th Century-Fox and the Ostrers. Of the total cash in- volved in . the situation, $2,000,000 goes to 20th Century and the other $2,000,000 to the Ostrers. Thus the Ostrers Will get not only $2,000,000 cash, under the present terms of the transaction, but addl- (Continued on page 12) Show-Cause Order That BiH Fox Turn Over ffis Afl-Continent Books WBnASCAP Reunion • Warner Bros, musical cata- logs became available again to licensees of the American So- ciety - of Composers', Authors and Pu blishe rs with the accept- ance of "WB's terms of reunion by ■ the ASCAP board at a meeting Monday afternoon' (5). Details of the reconciliation in - the music department Salient reaison for the patching-up is that the WB film end deemed itself suffering through the schism. - ■ Reaction of the Department of Justice to the settlement of the WBtASCAP dispute is con- tained in a story from Washing- ton in the radio department. STUDIOS FRET At DIRECTOR SHORTAGE Hollywood, Aug. 4. Lack of directors has several of the -major • studios. worried. ' Cur- rently, Radio and Universal are switching production skeds about in order to obtain 'services of desired meggers. Freelance directors in the selling class are lacking, too. Run- of-the-mill meggers are plentiful. B. P. Schulberg, Emanuer Cohen and Walter Wanger are fretful about the situation. Cohen tried for some time to get a handler for Mae West's 'Personal Appearance,' but found none available. He finally had to make a borrowing deal with Para- mount to get Henry Hathaway. William K. Howard and Gregory La Cava have been tempted with of- fers to return from England.' Radio wants a replacement for the late Stephen Roberts, . Lee Marcus Gets Supe Job at Radio; Gilroy Up Hollywood, Aug. 4. Sam Briskin has appointed Lee Marcus production assistant to su pervise 15 pictures to be turned out by various producers. Bert Gilroy replaces Marcus as head of studio's shorts department. PAR STUDIO SHAKEUP; LEBARON AT HELM. SHELDON-HENIGSON OUT Hollywood, Aug. 4. Adolph Zukor made it known that he was the Paramount production boss when he. issued an order on Saturday (1) that all producers on the lot in the future would be re- sponsible to William LeBaron, head of all studio production, directly, and relieved producers working un- der Harold Hurley and A. M. Bots- ford from reporting to the duo in the future. . Hurley and Botsford, who eacli were to have made 11 pictures with the aid of producers under them, will individually make their own pics for the 1936-37 slate. Hurley is to make six pics in the B-class and two or three in the A-division, which makes him a new acquisition to the A-group of producers. Botsford is to make six features in the B-division. Producers who worked under Hurley and Botsford are Eddie Cline, Jack- Cunningham, William Lackey, Mel Shauer, Sid Brod and George Arthur. They will get their assignments from the LeBaron office in the future, and divide the making during the 1936-37 season of around 16 pictures between them. In the change ordered by Zukor all aides to the two producers have been relieved, of their assignments with the exception of their respec- tive biz managers and story editors, Milton Merlin, story ed, and Ray Bums, biz manager, remain with Hurley, and Marian Spitzer, story editor, and Dan Keefe, biz manager, with Botsford. Zukor, it is said, in this move has started a preliminary of a studio production realignment with many changes in the general setup to be- come effective within the next two weeks. Understood that efforts are being made currently to settle con- tracts of E. Lloyd Sheldon, who has been a producer with company since 1922, and- Henry Henigson, who joined about a year ago. Sheldon leaves the Par fold after completing the productions he is now making. One more picture is due, but that will be adjusted. Understood also that in addition to the moves already conteirplated, status ol other producers on the lot will be changed or more specifically defined for the future. Negotiations are &\so on to bring Jeff Lazarus back into the fold as head of the editorial and story board at the studio. Lazarus came to stu- dio in 1932, and for three years prior to his resignation last April was head of the story board. He re- cently returned from a European jaimt and was given the proposition to return to his old post over the weekend. Likely that Mel Shauer, who made one picture as a producer, may be returned to an executive post simi- lar to the one he occupied prior to switching of his duties. Shauer may concentrate in future entirely on matter of building up new talent in all creative branchea. Atlantic City, Aug. 4. A petition filed in court today (Tuesday) by Hiram Steelman, trus- tee in bankruptcy for William Fox, charged that the $6,100,000 All-Conti- nent Corp., listed in the. name of the former film magnate's-wife, was created for the purpose of "tying in his own private affairs." As a result of the trustee's peti* tion. Referee Robert E. Steedle or* dered the All-Continent concern to show cause before him next Tuesday (11) why it should not be requested to turn over its books for 'complete and thorough examination' in con- nection with Fox's voltmtary bank- ruptcy action. When Fox sought bankruptcy last May 20, he listed debts of $9,535,261. He also listed assets of $1,500,100, most of which have subsequently been wiped out by sheriffs' sales In California. Creditors announced the intention before Referee Steedle to show that the All-Continent Corp. was 'an alter-ego of William Fox'; that the concern refused to tiirn its books over for examination on the groimd that it was owned by hia wife, and that its affairs were there- fore of no concern to Fox's creditors. The trustee recited in .his petition today that 'throughout the books, of . the bankrupt Fox there are numer- ous instances of erasures . . . and in numerpus instances corresponding erasures appear in the books of the AUr-Continent Corp.' Leltsteen's Admissions. He pointed out that Herbert Leit- steen, who for 27 years had been Fox's private bookkeeper, also kept the All-Continent books, and that the $6,100,000 of personal securities used to foimd the All-Continent Corp. 'eventually found their way back into Mr. Fox's vaults.' 'Leitsteen admitted,' the petitioii read, 'that -it was impossible to make up a list of assets and. liabilities of the Fox .fijm from the letter's own records, and admitted he did from time to time use; the books of Alf- Continent ior , purposes of . posting entries in the books of Fox.' . The company's passbook, said' the petition, lists total disbursements of $13,100,000, for which $12,115,000 was in connection with transactions with Fox. or the benefit of Fox. 'The main purpose of its organizar tion' the petition went on, 'was as a vehicle to the bankrupt in carrying on his own private affairs,' Stcelman observed Fox and the All-Continent Corp, not only shared officers and bookkeepers, but also .shared legal talent and the name 'Ben Iico' on secret brokerage ac- counts. He said Leitsteen's testi- mony showed the law firm of Hirsch, Newman, Reass & Becker, of New York, acted as 'clearing house for funds exchanged between Fox, the AU-Contirient Corp. and the latter's subsidiaries,' During all of last week counsel for creditors tried to show that the $6,400,000 All-Continent Corp. listed in the name of Fox's wife, actually belonged to the film man. The Records David Katz, of New York, pro- duced a copy of what he said was a letter from the Aronberg-Fried Co„ to the Maryland Casualty Co., apply- ing for a $2,700,000 bond on a $5,380,000 contract to erect a new building for the Department of 'Agri- (Contlnued on pagre 40) GRIFHS, BALABAN'S COAST VISIT PLANS Stanton Griffis, chairman of Para- mouni'r. executive committee, is go- ing to Hollywood, but he will go to Europe first. The Hollywood trip will be for Paramount primarily, but while abroad Griffis may also take a peek at some of Par's foreign prop- erties, Griffis is not a film man. It is possible that Barney Balaban, nei"/ president of Paramount, may accompany Griffis to the Coast, Thi» would be Balaban's first trip to th»- Coast since he became president.