Time Warner Cable CEO Robert Marcus stands to get a $80 million golden parachute for negotiating the sale of the company to rival Comcast.
In a filing about the deal Thursday, Comcast disclosed the estimated value of the Time Warner Cable parachutes for its top officers.
Marcus's annual compensation package under the contract he signed last year would have been $6.5 million in salary and cash bonus, and $9.5 million in stock grants. So the $79.9 million package comes out to nearly five year's worth of minimum compensation. But about half of the value of that parachute is due to the immediate vesting of restricted stock and options he had received in the past when he held other positions with the company. He became CEO on Jan. 1 after serving as its president.
Arthur Minson, chief financial officer, will get a $27.1 million parachute, while Michael LaJoie, the chief technology officer, gets $16.3 million, while Philip Meeks, the chief operating officer, gets. $11.7 million.
Of course the announced $45 billion deal to combine the nation's two largest cable companies is far from certain. It still requires the approval of regulators, who are certain to hear objections from consumer groups arguing the deal is bad for customers.
Executive employment contracts typically contain golden parachutes which promise big payout if there is a "change in control" of the company.
The idea is that shareholders do not want executives to block a possible deal that would be good for shareholders due to concerns about how it will affect them personally. The company also does not want top executives or leave the company while merger negotiations are underway.
But the size of some recent parachutes has raised questions.
Former Heinz CEO William Johnson became eligible for a $212.6 million golden parachute after the company was purchased last year by a Warren Buffett's Berkshire Hathaway ( and private equity firm 3G Capital. )
But sometimes the golden parachute can pay off even when the executive is fired for problems with his or her performance.
Henrique de Castro, who was essentially fired as chief operating officer of Yahoo ( earlier this year due to poor performance, left with a golden parachute estimated to be more than $60 million despite being at the company for only 15 months. )