Cable Operators

Smit to Make $2.4M, Scaling Above Vogel

8/19/2005 8:00 PM Eastern

Charter Communications Inc.’s new CEO, Neil Smit, is slated to make a cool $2.4 million this year, the MSO said in securities filings last week.

Smit, who will become Charter’s fourth CEO since 2001 on Aug. 22, signed a three-year employment deal with the fourth-biggest U.S. MSO on Aug. 9.

Smit is to receive an annual salary of $1.2 million for the first three years of a contract that expires Dec. 31, 2008. St. Louis-based Charter has the option to extend the pact two more years. If it does, Smit’s annual salary bumps up to $1.4 million.

Charter’s former CEO, Carl Vogel, who resigned in January, was paid $1 million a year in salary.

Smit is eligible for an annual performance bonus of 125% of his salary, with a maximum bonus of 200%. For 2005, he agreed to a minimum bonus of $1.2 million, provided he is still CEO at Dec. 31.

Smit will also receive options to purchase 3.3 million shares of Charter stock, exercisable for 10 years and vesting at one-third of the annual grant for each of the three years of the contract. He is also eligible for a performance share award of 4.1 million shares over three years starting in January and a restricted stock award of 1.25 million shares, with annual vesting over three years following his employment date.

And he’ll receive a 1.25 million-share restricted stock award vesting on the first anniversary of his employment start date.

Smit stands to make millions more if he can boost Charter’s stock price. With an opportunity for 6.7 million shares through grants and bonuses and options for another 3.3 million shares, increasing Charter’s share price by $1 each — it was at $1.17 on Aug. 17 — could put another $10 million in his pocket.

Vogel’s deal, in contrast, gave him a $1 million base annual salary but his bonus was capped at $500,000. Vogel had options for 3.4 million shares but only 50,000 shares of restricted stock.

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