Eisner resigns from Disney board

updated 8:37 p.m. ET Oct. 6, 2005

BURBANK, Calif. - Michael Eisner, who stepped down last week as chief executive of The Walt Disney Co., has resigned his seat on the company’s board of directors, Disney said Thursday.

Eisner and the company have severed all ties in a surprise move that means he will not serve as a consultant as he had been entitled to do under his employment agreement.

Eisner “no longer provides any services” for Disney, the company said in a filing with the Securities and Exchange Commission.

Eisner resigned from the board on Sept. 30, his last day as CEO, according to the filing. Disney’s former president and chief operating officer, Robert Iger, succeeded Eisner the next day.

Eisner, who led the media and theme park company for 21 years, had been expected to remain on the board until next spring when Disney elected a new board.

Disney declined to comment beyond the filing, spokesman David Caouette said.

At one time, Eisner had hoped to continue a relationship with Disney, perhaps even as board chairman. But since Iger was named last March to succeed him, Eisner has stepped aside and allowed Iger to run the company, even watching as Iger ended two-year feud with dissident ex-director Roy E. Disney, who had pushed for Eisner’s removal.

In its filing, the company also revealed details about Iger’s contract.

The new Disney boss has signed a five-year contract and will retain his position as the company’s president. He will receive a salary of $2 million a year, the same salary he received last year as president and COO.

Iger will also receive bonuses and other incentives tied directly to the company’s performance.

Iger’s annual bonus target will be a minimum of $7.25 million. He will receive a long-term incentive bonus of company stock with a target value of $8 million per year, also tied to performance.

The bonus and long-term incentive could be raised and could also be cut to zero, depending on performance, his contract states.

Iger also receives a one-time bonus of 500,000 shares that will vest over five years if the company’s stock performs at least as well as the S&P 500 Index over the same period.

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