Lillis Had $15M Payday in 19984/11/1999 8:00 PM Eastern
Charles Lillis, who recently negotiated the sale of his
company as chairman and CEO of MediaOne Group Inc., was paid about $15 million in salary,
bonuses and stock awards last year.
He stands to make even more after MediaOne's sale to
Comcast Corp. closes, a securities filing revealed last week.
According to a proxy statement that MediaOne filed in
connection with the Comcast merger, Lillis was paid a salary of $793,538 in 1998 and a
bonus of $900,000.
Lillis' biggest boost came from a $10.3 million
restricted stock award that the company said was issued "in recognition of the
critical role [that Lillis] plays to the future success of MediaOne Group and to encourage
his continued service to the company."
Lillis also received options on MediaOne stock worth $3.3
million and long-term incentive-plan payouts of $171,174 for the year.
Although Lillis' salary was a big jump from 1997, when
he took home $1.3 million in salary and bonus, his compensation was dwarfed by that of
Richard McCormick, former chairman and CEO of MediaOne and U S West.
McCormick -- who retired shortly after U S West and
MediaOne completed their separation agreement last June -- pocketed $30.2 million in 1998,
mostly in the form of stock options and compensation as part of a separation agreement
with the company.
McCormick received $18.9 million in 1998 as part of that
separation agreement, which kicked in after U S West and MediaOne split. He also received
$5.1 million in long-term incentive payouts.
The proxy also broke out 1998 pay data for Jan Peters,
president and CEO of MediaOne's broadband-services unit, who made $3.4 million in
salary, bonus and stock options; executive vice president and chief financial officer
Richard Post, who made $2 million; and A. Gary Ames, president and CEO of MediaOne
International, who took home $2.8 million.
Lillis has more pay coming as a result of the Comcast
merger. Although he will become vice chairman of Comcast after the merger, there are
change-of-control compensation provisions activated if he is no longer CEO of the company.
Comcast agreed to buy MediaOne late last month in a deal
valued at about $60 billion, and Brian Roberts is Comcast's chief executive.
According to the proxy statement, if certain MediaOne
executives -- including Peters, Ames and Post -- are terminated as a result of the merger,
they are entitled to any unpaid salary and incentives, as well as to an amount equal to
three times the sum of their annual base salary prior to termination.
MediaOne will also pony up to pay excise taxes incurred in
connection with termination benefits.
Lillis, Peters and Ames also receive continued health-care
benefits indefinitely and the use of office space for a limited time.
It is possible that the MediaOne executives may have to
take advantage of those separation agreements. In announcing the deal, Comcast did not
specify any management changes, but the general consensus in the industry is that some
MediaOne executives could be pushed out in favor of their Comcast counterparts.
In all, Comcast said it plans to cut about 5 percent of the
combined 34,000-person work force of the two companies.
Whatever happens, it appears that MediaOne's top
management will get substantially better severance packages than lower-echelon employees
at the company.
According to some sources, MediaOne managers and employees
below them who are let go would receive nine months of salary and health benefits, while
directors and above will receive one year's pay and medical benefits.