As Nortel’s (OTC:NRTLQ) financial implosion starts to claw away at the pensions of former employees, I thought it would be interesting to take a look at the pension packages given to recent CEOs. It is important to keep in mind that while the pension payments seem high, it’s probably not out of line with pensions given to CEOs who had worked for many other Fortune 500 companies.
Mike Zafirovski: Originally, Mike Z. was entitled to a “special lifetime annual pension benefit” of $500,000 that would kick in upon his termination as CEO, or after five years. In 2007, Zafirovski voluntarily requested the package be reduced to $355,000.
Bill Owens: Although he was Nortel’s CEO for less than two years, Owens walked away with a ultra-sweet severance and pension package. His “pension benefit” consisted of an initial payment of $703,913 in June 2006, and then equal monthly payments of $99,073 through to November 2010.
Frank Dunn: Dunn, who was fired for cause in 2004, received $2.4-million upon his termination, representing the commuted value of his pension benefits. With 27.92 years of service, Dunn would have been eligible for an annual pension of $400,000 to $600,000.
John Roth: Roth, who left in 2001, received an annual pension of more than $800,000 based on 33 years of service and annual compensation of $1.86-million.