CBS's Moonves Stands to Reap $90 Million on Path to Retirement

(Bloomberg) -- Les Moonves’s new contract ensures he’ll be able to collect generous paychecks from CBS Corp. for at least another decade.

CBS said last week that Moonves, 67, agreed to remain chief executive officer through June 2021. The accord entitles him to as many as 574,000 shares, worth $35 million now, and up to $55 million in cash, depending on the company’s stock price and adjusted operating income between now and then, according to a regulatory filing Wednesday. That’s on top of his regular annual target compensation of about $40 million.

When the contract expires, Moonves, who will be 71 at that point, can remain with CBS as a senior adviser for another five years, as he could under previous contracts. The agreement calls for the company to pay him a $5 million annual fee and a one-time grant of shares worth $15 million.

Moonves, who’s consistently been one of America’s top-paid public company executives in recent years, can also test his wings as a producer for up to six years after he steps down as CEO -- another perk that’s carried into the new contract. CBS is obligated to reimburse him up to $4 million for overhead and $1.5 million to develop film, TV and digital content. He’d be 77 when that period lapses.

It’s a generous arrangement even when compared to other companies in the media and entertainment industry, which is known for compensating its CEOs handsomely. Businesses in other sectors sometimes offer their departing executives advisory roles for a few years, which can be a way to make sure they don’t go to a competitor. Whether or not that happens can depend on the terms of the separation.

A CBS spokeswoman declined to comment. The shares were little changed at $61.67 in New York.

Viacom Inc.’s ex-CEO Philippe Dauman, who left in 2016 following a legal battle with the Redstone family, which controls the business, and walked away with as much as $95 million in his final year on the job, wasn’t offered the option to stay on as an adviser. However, Viacom is bound to pay for an offsite office and the services of secretary Rosemarie Cresswell for three years.

Bob Iger, whose term as CEO of Walt Disney Co. expires in July 2019, will remain a consultant for three years after leaving, his job contract shows. The company will pay him a total of $5 million over that period. His predecessor Michael Eisner, who left in 2005, had the option to serve as a consultant but decided not to. David Zaslav at Discovery Communications Inc. doesn’t have a similar provision in his employment agreement.

Donnie Smith resigned from Tyson Foods Inc. last year with a commitment to remain a consultant through 2019, working a maximum of 33 hours a month in exchange for as much as $5,800 per hour. Jerry Moyes, founder of Swift Transportation Co., stepped down last year with a $2.4 million-a-year consulting job at the company, which is more than he was awarded in his last year as chief executive.

Moonves took over CBS in January 2006 after overseeing the split from Viacom. The company shares have returned more than 10 percent annually since then, compared with an 8 percent increase in the S&P 500 Index.

--With assistance from Jenn Zhao

To contact the reporter on this story: Anders Melin in New York at amelin3@bloomberg.net.

To contact the editors responsible for this story: Alicia Ritcey at aritcey@bloomberg.net, Rob Golum, Crayton Harrison