I wondered how long this was going to take.....Will Gordo follow??
Delta CEO Mullin Gives Himself Pay Cut
Thu Apr 3, 7:25 PM ET Add Business - Reuters to My Yahoo!
NEW YORK (Reuters) - Delta Air Lines Inc. (NYSE
AL - news) Chairman Leo Mullin, publicly criticized in Congress and elsewhere for his compensation, said on Thursday he will give back about $9.1 million that he might have received in 2003 and beyond, citing tough times for the airline industry.
Mullin, who became the No. 3 U.S. carrier's chief executive in August 1997 and chairman in October 1999, said he will cut his base salary 25 percent to $596,250 from $795,000, according to an internal memo to employees obtained by Reuters.
He also said he will not accept incentive pay for 2003, rescind retention payments he might earn in 2004 and 2005, and rescind stock-based awards granted in his current five-year contract, according to the memo. Delta estimated the value of the incentive pay at $1 million, the retention payments at $2.4 million, and the stock awards at a minimum of $5.5 million.
"The decisions in regard to executive compensation were fully appropriate in the context of the time in which they were made," Mullin wrote. "However, the reality of the airline industry is that the context changes rapidly. Concerns we are now facing were not part of the environment when those earlier decisions were made, or their importance has been magnified."
Mullin was in 2002 among the best paid airline executives. U.S. Securities and Exchange Commission (news - web sites) filings show.
His pay package totaled about $13 million in 2002, while Continental Airlines Inc. (NYSE:CAL - news) Chairman Gordon Bethune received a $11.9 million package, and UAL Corp.'s United Airlines Inc. (NYSE:UAL - news) Chairman Glenn Tilton got a package worth up to $9.65 million. US Airways Group Inc. (Other OTC:USALA - news) Chief Executive David Siegel was paid $1.45 million.
Washington is wrestling with how to bail out large U.S. carriers, which the Air Transport Association has said may lose $11 billion this year, in part because of the Iraq (news - web sites) war.
Last week Sen. John McCain of Arizona told reporters: "I'm sure every American is angry (with Mullin's pay package) because (Delta) laid off thousands of employees."
Delta said in its annual report it expects by May 1 to finish most of a cost-cutting program in which it aims to eliminate about $350 million of annual costs and as many as 8,000 jobs. It still employs more than 60,000 people.
In his memo, Mullin said that in deciding how to cut his compensation, it "became clear ... that there was no absolutely correct approach or set of actions. But, in the current circumstances, the steps I am taking feel right to me."
Delta is based in Atlanta. Its shares closed Thursday at $9.73, up 4 cents.
Delta CEO Mullin Gives Himself Pay Cut
Thu Apr 3, 7:25 PM ET Add Business - Reuters to My Yahoo!
NEW YORK (Reuters) - Delta Air Lines Inc. (NYSE
AL - news) Chairman Leo Mullin, publicly criticized in Congress and elsewhere for his compensation, said on Thursday he will give back about $9.1 million that he might have received in 2003 and beyond, citing tough times for the airline industry. Mullin, who became the No. 3 U.S. carrier's chief executive in August 1997 and chairman in October 1999, said he will cut his base salary 25 percent to $596,250 from $795,000, according to an internal memo to employees obtained by Reuters.
He also said he will not accept incentive pay for 2003, rescind retention payments he might earn in 2004 and 2005, and rescind stock-based awards granted in his current five-year contract, according to the memo. Delta estimated the value of the incentive pay at $1 million, the retention payments at $2.4 million, and the stock awards at a minimum of $5.5 million.
"The decisions in regard to executive compensation were fully appropriate in the context of the time in which they were made," Mullin wrote. "However, the reality of the airline industry is that the context changes rapidly. Concerns we are now facing were not part of the environment when those earlier decisions were made, or their importance has been magnified."
Mullin was in 2002 among the best paid airline executives. U.S. Securities and Exchange Commission (news - web sites) filings show.
His pay package totaled about $13 million in 2002, while Continental Airlines Inc. (NYSE:CAL - news) Chairman Gordon Bethune received a $11.9 million package, and UAL Corp.'s United Airlines Inc. (NYSE:UAL - news) Chairman Glenn Tilton got a package worth up to $9.65 million. US Airways Group Inc. (Other OTC:USALA - news) Chief Executive David Siegel was paid $1.45 million.
Washington is wrestling with how to bail out large U.S. carriers, which the Air Transport Association has said may lose $11 billion this year, in part because of the Iraq (news - web sites) war.
Last week Sen. John McCain of Arizona told reporters: "I'm sure every American is angry (with Mullin's pay package) because (Delta) laid off thousands of employees."
Delta said in its annual report it expects by May 1 to finish most of a cost-cutting program in which it aims to eliminate about $350 million of annual costs and as many as 8,000 jobs. It still employs more than 60,000 people.
In his memo, Mullin said that in deciding how to cut his compensation, it "became clear ... that there was no absolutely correct approach or set of actions. But, in the current circumstances, the steps I am taking feel right to me."
Delta is based in Atlanta. Its shares closed Thursday at $9.73, up 4 cents.
