Took the money and ran…

September 13, 2004

By now, anyone who’s interested knows that US Airways (UAIR) filed for bankruptcy protection yesterday. Less visible is the rich send-off that former CEO David Siegel collected when he left the company. That was buried in exhibit 10.10 — after a long string of seemingly routine loan extensions and other miscellaneous agreements — in the Q the company filed last month. Under Siegel’s severance agreement, he collected $4.72 million 5 days after stepping down on April 19. The pay-off was equal to 3 times Siegel’s base salary and three times his target annual bonus. The severance agreement also spells out a string of other goodies, including nearly $3 million in contributions to an executive defined contribution plan and $2.15 million in tax gross-up payments. There was also lots of stock — 669,000 options and 1.13 million restricted shares which vested immediately, though based on the filings, it doesn’t appear that Siegel sold while the stock was still worth anything. Still, all in all, it’s not a bad little payday and retirement fund for someone who only spent two years at the company.

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