Nice Compensation Package

AbitibiBowater’s compensation package for their new Chief Financial Officer

November 16th, 2011 | Posted in Misc. | 1 comment »

Jo-Ann Longworth took over the position of Senior Vice President and Chief Financial Officer of AbitibiBowater (now Resolute Forest Products) when William G. Harvey stepped down from the position on August 31, 2011.

In AbitibiBowater’s recent quarterly statement, Longworth’s salary and Harvey’s compensation were made public.

William G. Harvey’s Severance

William G. Harvey resigned from his position of Chief Financial Officer as of August 31, 2011.

Terms of departure include:

• Severance Pay = $1,303,681.44
• Retroactive Pay = $42,000
• + Vacation Pay (for all accrued but unused vacation time + 12% of base salary earned in 2011)
• + Short Term Incentive Plan Bonus pro-rated for 2011
• + Long Term Incentive Plan Bonus

As a condition of receiving the severance pay, Harvey agreed to waive all claims against the company, except the following amounts:

• $252,268 for regular and synergy bonuses pursuant to the 2008 Annual Incentive Plan
• $133,279 related to the Executive’s relocation process following the Abitibi/Bowater Merger (without any admission from the Company that the Executive did relocate to Canada)
• $135,000 for education allowance
• $10,208.19 for reimbursement of tax penalty

Each of these will be settled, if and when allowed, to the extent provided in accordance with applicable bankruptcy rules and procedures.

William G. Harvey’s Consulting Agreement

For 7 months after his termination day, Harvey will provide consulting services to the new Senior Vice President and Chief Financial Officer.

Details:

• less than 20% of his previous worked hours
• Consulting fees: $40,000 / month
• Professional fees: not to exceed $10,000
• will provide all consulting services from the USA

Jo-Ann Longworth’s Salary and Compensation Package

• Annual Base Salary: $350,000 (Canadian funds)
• Short Term Incentive Plan: targeted at 100% of base salary for 2011, with opportunity to earn 150%. (overall maximum incentive payout cannot exceed 7% of company’s free cash flow in 2011)
• Long Term Incentive Plan: Likely 125% of base salary for 2011 – to be determined by Board of Directors
• Pension Plan – Employee contributes 5% of eligible earnings (to a limit of $245,000), Company contributes 20.5% of eligible earnings)
• Vacation – 5 weeks a year
• Allowance – up to $12,000/yr to cover items such as club membership, fiscal and financial advice, and tax preparation
• Annual Medical Examination provided by the company for Longworth and her spouse (up to $1,500 per person)
• Parking