Company cuts new five-year employment contract

CBS Corp. is living up to its reputation as a bastion of stability. The Eye on Wednesday unveiled a new five-year employment pact that will keep Leslie Moonves as prexy and CEO of CBS through February 2015.

The new deal replaces Moonves’ existing contract, which was to have expired in September 2011. CBS made a point of noting that Moonves’ base salary will remain the same as in his last contract, $3.5 million a year. Like other public corporations, CBS has drawn flak from some shareholder watchdog orgs for the tonnage of its CEO’s compensation package.

“Leslie is a superb executive who has led CBS to a position of unparalleled leadership in the industry,” CBS Corp. chairman Sumner Redstone said in announcing the deal. “This agreement not only secures the future of the company for many years to come, it also further aligns and strengthens the interests of the chief executive with those of our shareholders.”

With bonuses, stock options and other coin, BusinessWeek calculated Moonves’ total compensation in 2008 at $13 million in salary and bonuses, plus he’s in line for another $11.5 million in long-term comp from a grant of 5 million stock options issued when his last employment contract was struck in 2007. For 2007, he earned a whopping bonus of $18.5 million, but it was cut in 2008 to $9.5 million after Eye shares took a big tumble along with most other media congloms.

CBS will disclose the details of Moonves’ 2009 compensation and his new employment pact in its annual filing with the Securities and Exchange Commission, which is expected this week.

In announcing the pact Wednesday, the Eye noted that the new contract “provided incentives for Moonves to continue his relationship with the company at the end of the employment term.” Moonves has been at the helm of CBS since 2003, and he has been the CEO of CBS Corp. since the company split from parent Viacom at the end of 2005.

The new deal will take Moonves through his 20th anniversary with CBS. He first joined the Eye as CBS Entertainment prexy in August 1995, after a successful run at Warner Bros. TV and Lorimar TV.

The five-year vote of confidence in Moonves comes as the mothership CBS network is riding high on strong ratings, which make the network well poised to capitalize on the gradual recovery in local and national TV advertising. The Eye is by far the nation’s most watched network, averaging 12.3 million viewers for the season to date.

In recent months, CBS has restructured its local TV and radio station management to cut costs and streamline operations.

Moonves also has made a big bet on breaking into the film biz. CBS Films got off to an inauspicious start last month with its first release, drama “Extraordinary Measures,” which did a fast fade at the B.O. Moonves has emphasized that the company’s risk is mitigated by keeping a tight rein on budgets and because pic production helps provide feature product for Showtime.

On an up day for the major indexes overall, CBS shares rose 18ยข, or 1.38%, on the Moonves news to close at $13.20.

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