ATLANTA (AP) – Incoming Delta Air Lines (DAL) CEO Richard Anderson will be paid an annual salary of $600,000 and could earn another $15 million in performance-based incentives, according to documents filed Monday by the airline.
Anderson, 52, was named Gerald Grinstein’s replacement as CEO last week and will take office on Saturday. With the appointment, Grinstein, 75, will retire from Delta and its board.
Aside from his annual salary, Anderson will become eligible on Saturday to earn $11 million in incentives tied to the company’s performance, the filing said. That sum is “in recognition of the substantial compensation awards that he forfeited by leaving UnitedHealth Group (UNH),” where he served as an executive vice president, the filing said.
Some 55% of the sum would be paid in restricted stock, 25% in stock options and 20% in performance shares, the company said. Anderson will be eligible for an additional $4 million in performance-based awards next year, the filing said.
Both the payments would generally be vested over a three-year period.
The change at the top at Atlanta-based Delta follows the airline’s 19½-month reorganization under bankruptcy protection.
Delta emerged from bankruptcy reorganization on April 30. In bankruptcy, Delta shed billions in costs and restructured the carrier’s operations. It also survived a hostile takeover bid by Tempe, Ariz.-based US Airways (LCC).
Grinstein delayed his announced departure from Delta for months while directors conducted the search for a CEO that ended with Anderson’s selection. Directors passed over at least two internal candidates in choosing Anderson, an industry veteran who once was CEO at Northwest Airlines (NWA).
Delta executives, faced with questions about a post-bankruptcy valuation below what they initially projected and below what US Airways offered for Delta, have declined to speculate about whether Delta would consider a deal with another carrier to increase shareholder value. Delta’s board also has to decide whether to sell or spin off regional feeder carrier Comair. The airline has not provided a timetable for that decision.
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Source: USA TODAY