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Warner Bros. Discovery, Inc. (NASDAQ:WBD) announced Thursday that it has amended the employment agreement and stock option terms for President and Chief Executive Officer David Zaslav as the company’s board continues a review of strategic alternatives, according to a statement in a recent SEC filing.
The company said its board initiated the review after receiving unsolicited interest from multiple parties. The review includes options such as a transaction involving the entire company or separate transactions for its Streaming & Studios business, known as Warner Bros., and its Global Networks business, Discovery Global.
As part of this process, on November 7, Warner Bros. Discovery and Zaslav agreed to clarify and amend his employment and nonqualified stock option agreements, which were originally entered into on June 12. The amendments are intended to align Zaslav’s incentives with shareholder interests during the ongoing strategic review.
The amended agreements specify that if the planned separation of Warner Bros. and Discovery Global is accomplished through a “Reverse Spinoff”—in which Warner Bros. is retained and Discovery Global is spun off—this will be treated the same as the originally planned separation for purposes of Zaslav’s compensation and stock options. The changes also expand the definition of qualifying events that allow Zaslav’s signing stock options to remain eligible to vest, including entering into a definitive agreement for a transaction that would result in a change in control of Warner Bros. Discovery, excluding any sale of Discovery Global or its substantial assets.
If the company enters into such a qualifying agreement before December 31, 2026, and a separation has not occurred by that date, Zaslav’s employment term will be extended to December 31, 2030, matching the term he would have received had the separation been completed. Compensation terms will also be modified to increase the proportion allocated to long-term incentives in these scenarios.
Similar clarifications were communicated to other executive officers with agreements contingent on the planned separation.
This information is based on a press release statement included in the company’s Form 8-K filing with the Securities and Exchange Commission.
In other recent news, Warner Bros. Discovery reported its third-quarter 2025 earnings, surpassing expectations with a loss of $0.06 per share, compared to the anticipated loss of $0.09 per share. Despite this positive earnings per share surprise, the company’s revenue came in at $9.04 billion, which was below the forecasted $9.18 billion. In a separate development, Paramount, Comcast, and Netflix are preparing bids for Warner Bros. Discovery, with a deadline for non-binding first-round offers set for November 20. The auction process aims to be completed by the end of 2025. Meanwhile, CFRA raised its price target for Warner Bros. Discovery to $24 from $21, while maintaining a Hold rating on the stock. CFRA’s valuation incorporated a wider equity risk premium and a forward TEV/EBITDA multiple of 10.1x. The research firm maintained its earnings per share estimates at $0.35 for 2025 and $0.10 for 2026. These developments reflect the ongoing strategic and financial activities surrounding Warner Bros. Discovery.
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