As part of its separation agreement with former CEO Les Moonves, CBS’s board will set aside $120 million for a possible severance payment, but Moonves will receive nothing if the board determines his departure was for cause.
CBS and the Redstone family, which owns voting control over the media company, reached an agreement Sunday that ends their power struggle and deposed Moonves, who is under fire after a series of allegations that he engaged in improper behavior with women over the course of his career.
Those allegations are being investigated by two law firms hired by CBS’s board.
In an SEC filing CBS Monday, the company said that the company will be contributing $120 million to a trust as part of Moonves’ separation agreement.
“In the event the Board determines that the Company is entitled to terminate Mr. Moonves’s employment for cause under his employment agreement and Mr. Moonves does not demand arbitration with respect to such determination, the assets of the grantor trust will be distributed to the Company and the Company will have no further obligations to Mr. Moonves,” according to the filing.
“In the event that the Board determines that the Company is not entitled to terminate Mr. Moonves’ employment for cause, or in the event of a final determination in arbitration that the Company is not entitled to terminate Mr. Moonves’ employment for cause, the assets of the grantor trust will be distributed to Mr. Moonves," the filing said.
CBS and Moonves have agreed to donate $20 million of his termination payment to #MeToo related causes.
The SEC filing also says that Moonves has agreed to “perform advisory services” for CBS for one year in order to assure a smooth transition.
The company will provide Moonves with office services and security services for up to two years.
The post-termination restrictive covenants in Moonves’ employment agreement will remain in force, which means he won’t be jumping to a rival media company.
Jon has been business editor of Broadcasting+Cable since 2010. He focuses on revenue-generating activities, including advertising and distribution, as well as executive intrigue and merger and acquisition activity. Just about any story is fair game, if a dollar sign can make its way into the article. Before B+C, Jon covered the industry for TVWeek, Cable World, Electronic Media, Advertising Age and The New York Post. A native New Yorker, Jon is hiding in plain sight in the suburbs of Chicago.
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