Disney Details Iger's Pay Package
By KATE KELLY
Staff Reporter of THE WALL STREET JOURNAL
October 7, 2005
Walt Disney Co. disclosed details of a five-year contract for new Chief Executive Robert Iger that could pay him $17.25 million a year in cash, bonus and stock awards if certain performance targets are met. At the same time, the company disclosed that Mr. Iger's predecessor, Michael Eisner, had resigned earlier than expected from the company's board.
In a Securities and Exchange Commission filing, Disney said Mr. Iger, who became CEO on Saturday, stands to receive $2 million in base salary and a target bonus of at least $7.25 million that is tied to meeting performance goals. He will also receive at least $8 million in equity-based compensation a year, again provided performance targets are met. Mr. Iger also will receive a one-time grant of 500,000 stock units, each equivalent to a share of Disney stock -- yet another performance-based award. (See related SEC filings.)
That sum compares favorably with the compensation awarded Mr. Eisner, whose 21-year run as Disney's CEO came to an end last week. Last year, Mr. Eisner received a base salary of $1 million and a cash bonus of $7.25 million. Mr. Iger, then the company's president, received $1.5 million in base salary along with a $6.5 million cash bonus. Mr. Iger's new contract lasts through September 2010.
While making room for generous incentive awards, Mr. Iger's deal reflects Disney's efforts to meet demands from investors and public officials for performance-based compensation at corporations. The company's board will expect the CEO to clear a set of performance hurdles in order to receive the incentive awards, such as meeting or beating the total shareholder return for the Standard & Poor's 500-stock index during given periods of time, according to the filing.
Mr. Eisner resigned as a Disney director Sept. 30, according to the filing. Since he had originally expected to stay on the board through the annual meeting early in 2006, the exit comes as a surprise. For a while, people close to the company have said, he harbored the notion of one day being named Disney chairman again. But after Mr. Iger's ascension was spelled out last spring, Mr. Eisner gradually detached from the company.
Write to Kate Kelly at kate.kelly@wsj.com
By KATE KELLY
Staff Reporter of THE WALL STREET JOURNAL
October 7, 2005
Walt Disney Co. disclosed details of a five-year contract for new Chief Executive Robert Iger that could pay him $17.25 million a year in cash, bonus and stock awards if certain performance targets are met. At the same time, the company disclosed that Mr. Iger's predecessor, Michael Eisner, had resigned earlier than expected from the company's board.
In a Securities and Exchange Commission filing, Disney said Mr. Iger, who became CEO on Saturday, stands to receive $2 million in base salary and a target bonus of at least $7.25 million that is tied to meeting performance goals. He will also receive at least $8 million in equity-based compensation a year, again provided performance targets are met. Mr. Iger also will receive a one-time grant of 500,000 stock units, each equivalent to a share of Disney stock -- yet another performance-based award. (See related SEC filings.)
That sum compares favorably with the compensation awarded Mr. Eisner, whose 21-year run as Disney's CEO came to an end last week. Last year, Mr. Eisner received a base salary of $1 million and a cash bonus of $7.25 million. Mr. Iger, then the company's president, received $1.5 million in base salary along with a $6.5 million cash bonus. Mr. Iger's new contract lasts through September 2010.
While making room for generous incentive awards, Mr. Iger's deal reflects Disney's efforts to meet demands from investors and public officials for performance-based compensation at corporations. The company's board will expect the CEO to clear a set of performance hurdles in order to receive the incentive awards, such as meeting or beating the total shareholder return for the Standard & Poor's 500-stock index during given periods of time, according to the filing.
Mr. Eisner resigned as a Disney director Sept. 30, according to the filing. Since he had originally expected to stay on the board through the annual meeting early in 2006, the exit comes as a surprise. For a while, people close to the company have said, he harbored the notion of one day being named Disney chairman again. But after Mr. Iger's ascension was spelled out last spring, Mr. Eisner gradually detached from the company.
Write to Kate Kelly at kate.kelly@wsj.com
