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Unpacking That Wild Disney Day

Get your popcorn ready for all the juicy Disney drama revealed Tuesday in a series of SEC filings.

NEW YORK, NEW YORK - NOVEMBER 08: Walt Disney CEO Bob Chapek attends Paley International Council Summit at Paley Museum on November 08, 2022 in New York City. (Photo by Steven Ferdman/Getty Images)

Disney CEO Bob Chapek attends the Paley International Council Summit 12 days before his Disney exit

Getty Images

Tuesday was quite the day of turmoil in Burbank — and for once, we’re not referring to chaos from the Warner Bros. lot.

Disney, in a proxy statement on Tuesday, outlined in great detail what led to former CEO Bob Chapek’s ouster. The company also unveiled Chapek’s 2022 payday as well as his golden parachute payout. The financial disclosures came mere hours after Disney shared a slideshow with the SEC that both propped up its board of directors and tore down desperate attempts to join by activist investor Nelson Peltz.

Disney revealed Chapek made $24.1 million in fiscal year 2022, down from the $32.5 million he earned the year before. (Iger, who took the reins back from Chapek in November, made $15 million in 2022 and nearly $46 million in 2021.) Additionally, Chapek stands to get an exit payout worth potentially north of $20 million.

The golden parachute is being deployed about seven months after Chapek’s contract as CEO was extended back in June. The Tuesday filing said Chapek was terminated “without cause,” adding that Iger is still “best situated to lead” while the company seeks a permanent successor.

“In June 2022, the Board agreed to extend Mr. Chapek’s employment agreement based on Mr. Chapek’s work navigating the Company through the unprecedented challenges of the pandemic and growing the Company’s streaming business,” Tuesday’s proxy filing reads.

“The Board continued to spend significant time discussing the leadership of the Company in the months that followed and determined that Mr. Chapek was no longer the right person to serve in the CEO role,” it continues. “The significant developments and change in the broader macroeconomic environment over this period informed how the Board viewed the appropriate leader in light of the rapidly evolving industry and market dynamics.”

Delivering Alpha 2015 -- Pictured: Nelson Peltz, Founding Partner and CEO, Trian Fund Management, at the 2015 Delivering Alpha on July 15, 2015 -- (Photo by: David A. Grogan/CNBC/NBCU Photo Bank/NBCUniversal via Getty Images)

Nelson Peltz, Founding Partner and CEO, Trian Fund Management

NBCU Photo Bank/NBCUniversal via Getty Images

In this time, Chapek was in touch with Peltz, the CEO of Trian Management. According to Disney’s account in the proxy report, Peltz met with Disney back in July when he began to lobby for a spot on its board. That was before Trian had officially invested an initial $500 million in the company. Since July, Peltz has lobbied as many as 20 times to join the board and, according to Disney’s telling of events, now threatens to start a proxy fight if he doesn’t get what he wants.

Disney though is both unhappy and unimpressed with Peltz. The company has recommended that shareholders vote against appointing him to the board, saying that Peltz “lacks a basic understanding of our industry by his own admission,” and that despite months of talks, Trian hadn’t “actually presented a single strategic idea for Disney” and is “oblivious” to bigger picture changes in media.

“Nelson Peltz does not understand Disney’s businesses and lacks the skills and experience to assist the board in delivering shareholder value in a rapidly shifting media ecosystem,” Disney said. “Peltz has no track record in large cap media or tech, no solutions to offer for the evolving media landscape. And if MSG Sports is his training ground, it has not been a good one.” (Peltz owns a stake in MSG.)

Peltz, whom with Trian has recently filed a series of SEC documents saying that Disney could benefit from his guidance, had the backing of Isaac Perlmutter. The Marvel Entertainment chairman told Disney brass that Peltz could help then-CEO Chapek “counter recent headwinds he had faced, solidify his position as CEO, and preempt any other potential shareholder nominations of director nominees at the 2023 Annual Meeting.”

OK, so that’s one guy.

Disney has proven it is open to hearing out activist investors — just not Peltz. The board added Third Point activist investor Dan Loeb’s hand-picked candidate, Carolyn Everson, back in September.

TAMPA, FL - JANUARY 16: Matt Overton #45 of the Dallas Cowboys celebrates after an NFL wild card playoff football game against the Tampa Bay Buccaneers at Raymond James Stadium on January 16, 2023 in Tampa, Florida. (Photo by Kevin Sabitus/Getty Images)

Matt Overton #45 of the Dallas Cowboys celebrates after NFL wild card playoff football win

Getty Images

So it’s an “L” for Peltz and was a weird day for Disney, which did have a few wins on the wild day. For starters, ESPN revealed its “Monday Night Football” game, a beatdown the Dallas Cowboys delivered to Tom Brady and the Buccaneers, is on pace to be Disney’s most-watched NFL Playoff game ever, excluding Super Bowls, with more than 31 million total viewers. (Final Nielsen data won’t be out until about 5 p.m. ET today.)

On the big screen, “Avatar: The Way of Water” on Tuesday became the sixth highest-grossing film of all-time (not adjusting for inflation) at the global box office, passing “Spider-Man: No Way Home.” Oh, and there was one more milestone: “Avatar 2” yesterday set a new record with 14 nominations for the Visual Effects Society Awards.

All of this and Disney stock (DIS) hasn’t even moved a dollar. Wild.

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