Revenues: $263 million. Salary: $1. Jeffrey Katzenberg: Priceless.

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Dreamworks Animation kingpin Jeffrey Katzenberg has extended his contract through 2013, news just about anyone could have predicted before its confirmation late Tuesday. Less clear: What he stands to gain from that contract, with its $1 annual salary and heavy, ambitious dependency on developments to come.

Obviously Katzenberg isn't hurting, currently gripping more than $450 million worth of DWA stock that is already up 23% today in early trading. And while his new deal also entitles him to another 900,000 restricted shares in 2009 and 2010, they're worth even less than a dollar without some sizable gains: Under a revised agreement featuring two tiers of payoffs, the share price would require a 72% spike -- where it would have to hold for a year -- followed by a 95% rise before Katzenberg sees a dime.

So sure, first-quarter revenues are up almost two-thirds from last year, Monsters vs. Aliens is staring at $500 million (at least) globally, and Shrek, Madagascar and Kung Fu Panda are each thriving in various stages of their franchise models. But really, this is about Katzenberg upping the stakes in ways that foretell a running start on some interesting hurdles: opening up (and cornering) the Blu-ray 3-D market, for starters, and eventually overtaking Pixar as both the creative and marketplace leader for most of the next decade.

That last bit would require a more substantial distribution arrangement than what he has at Paramount -- in a nutshell, those recurring rumors about a DWA sale might need to attain reality. 2013 seems as reasonable a date for that as any: The 'Mount deal ends in 2012, likely a post-recession climate with progressive stock appreciation behind it and no fewer than three franchises rotating annually. Wouldn't you buy that -- or at least that promise -- for a dollar?

· Katzenberg with D'Works through 2013 [Variety]



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