The board of Paramount Global has said that the company's three co-CEOs will continue to receive their annual bonus payments even if they are no longer in their leadership positions.
The decision comes as Paramount prepares to merge with David Ellison's Skydance Media in 2025.
An SEC filing revealed that the three co-CEOs -- Chris McCarthy, George Cheeks, and Brian Robbins -- will be able to resign and receive severance payments if their new responsibilities are "substantially inconsistent" with their roles or if there is a material reduction in the positions or duties.
They would receive an additional 100% of their base salary along with $3 million worth of restricted share units of Paramount's Class B common stock. The shares will be distributed over three years, beginning on the first anniversary of the grant date.
McCarthy, Cheeks, and Robbins were appointed co-CEOs on April 29, following the departure of former CEO Bob Bakish, who left due to disagreements with Shari Redstone, the company's controlling shareholder, Reuters reported.
Ellison, the son of Oracle Corp. co-founder Larry Ellison, will assume the role of chief executive of the merged company when the deal closes in the first half of next year.
Ahead of securing a deal with Skydance, Paramount formed the three-member Office of the CEO effective as of May 1, consisting of Cheeks, President and Chief Executive Officer of CBS; McCarthy, President and Chief Executive Officer, Showtime/MTV Entertainment Studios and Paramount Media Networks; and Robbins, President and Chief Executive Officer of Paramount Pictures and Nickelodeon (each, a "co-CEO").
Additionally, the board designated McCarthy as interim principal executive officer, effective May 1, 2024, according to the filing.
In anticipation of the $8 billion merger, the three co-CEOs were directed to identify cost-saving areas within the company, aiming for a reduction of $500 million in expenses. It included the reduction of the company's workforce in the U.S. by 15%.
Paramount also hired bankers to look into the possibility of selling non-core assets and is actively involved in discussions regarding possible joint ventures or streaming partnerships.
Bakish will be staying with the company until Oct. 31 and will act as a senior adviser. He will be assisting in the transition and the end of his employment would be regarded as termination without cause.
The former CEO would also receive a monthly base salary of $258,333.33 during the transition period. He will also be eligible for a pro-rated bonus for 2024.
"During the Transition Period, the Parties acknowledge and agree that Executive's level of services with the Company shall in no event decrease below 20% of the average level of services provided by Executive during the immediately preceding 36-month period," the filing stated.
In addition, Bakish will receive a severance package of $48.5 million, which will be classified under a "non-qualifying change in control termination."
