Discovery Communications revamped its employment agreement with CEO David Zaslav, extending the deal to early 2015, increasing his base salary to $3 million and creating incentives that could reap the cable veteran more than $55 million over the life of the contract.
According to documents filed with the Securities and Exchange Commission late Thursday, Zaslav's new employment agreement -- his old one wasn't scheduled to expire for another two years -- calls for a new base salary of $3 million, up from $2 million last year, beginning in 2011. Discovery also will increase Zaslav's annual incentive target in 2009 to $4 million, up from $3.5 million in 2008, and subject to $500,000 increases from 2010 to 2014 to about $6.5 million.
Zaslav also will be eligible to receive performance-based restricted stock units between 2010 and 2012 worth a total of about $44 million. In addition, if he remains with Discovery through Dec. 31, 2014 he is entitled to receive upon his separation from the company, a package worth about $12.25 million (two times the average of his base plus two times the average of his annual bonus for the last two years of the deal)..
In a statement, Discovery founder and chairman John Hendricks said the company decided to redo Zaslav's agreement early to keep him on board.
"By any measure or metric, Discovery Communications has had a terrific performance, and securing David's leadership gives me great confidence [that] the best is yet to come," Hendricks said in a prepared statement.
Zaslav joined Discovery in late 2006 from NBC Universal and has led the stable of networks through a strong period of growth -- the company was the only major programmer to report ad sales gains in both the first and second quarters.
Zaslav has also steered Discovery through a structural reorganization -- where Cox Communications surrendered its 25% interest in exchange for $1.3 billion in cash and the Travel Channel -- and has reorganized the company itself, creating new channels like Planet Green, the Oprah Winfrey Network (scheduled to launch in 2010) and a joint venture network with Hasbro.