Posted 6/5/2008 04:57 am
Updated 1 year ago
The deal to sell Alltel Corp. of Little Rock to Verizon Wireless would mean a substantial payout for Alltel executives, according to filing with the U.S. Securities and Exchange Commission.
Alltel President and CEO Scott Ford and other members of Alltel's management team have contracts that pay three years of salary and bonuses in the event that wireless firm sells.
The most recent executive compensation disclosure by Alltel showed the following base salaries for top executives during 2007:
- Ford, $1.23 million;
- Group President Jeffrey H. Fox, $696,808;
- EVP and General Counsel Richard N. Massey, $516,154;
- CFO Sharilyn Gasaway, $395,615; and
- VP C.J. Duvall Jr., $325,177.
Those contracts were put in place last year, when then-publicly traded Alltel sold to a pair of private equity firms.
Also, Ford "rolled over" just under $22 million worth of Alltel stock options at the time of the merger, according to the Form 10-K Alltel filed with the Securities & Exchange Commission in March.
Since he said investors realized a return of approximately 30 percent with the sale to Verizon, his rollover investment grew by approximately $6.5 million since November.
This doesn't include the value of 8.14 million shares of unexercisable performance and time-based options granted at the time of the merger in November.
Other Alltel executives also made rollover investments. At a 30 percent rate of return, their investments grew as follows:
- Gasaway, $1.2 million;
- Fox, $3 million;
- Massey, $600,000; and
- Duvall, $600,000.
Gasaway, Fox, Massey and Duvall also received unexercisable performance and time-based options at the time of the merger.
Ford disposed of all his publicly traded shares of Alltel when the sale closed on Nov. 16, according to an SEC filing, but the preliminary proxy that Alltel filed in June 2007 in anticipation of the sale included this language:
"Further, [the acquiring company] has informed us that it currently intends to establish equity-based incentive compensation plans for management of the surviving corporation, a portion of which may be allocated to our executive officers."
In Thursday's announcement about the sale Verizon said Ford will remain with the company "until the merger is completed."