Brian Sumers details former United CEO Jeff Smisek’s payout to walk away from the airline.
- $4.8 million cash severance
- Vesting of $3.5 million stock
- He still gets a performance bonus (!) — a pro-rated based on the portion of the year he served as CEO and United’s meeting stated performance targets.
- full family benefits for the next 4 years (until he becomes eligible for medicare)
- flight benefits and parking (and cash to cover taxes on those benefits) for life.
- He also gets to keep his company car.
The only kicker? If he’s convicted, pleads guilty, or no contest to a “crime of moral terpitude” relating to his service with the airline, he loses benefits and may have to pay back his severance and stock award.
He’ll clearly say anything the government wants in connection with his involvement in the scandal surrounding the former Chair of the Port Authority of New York/New Jersey as long as it keeps him from being charged with a crime. He’s got about $10 million in walk away money on the line.
Or — and this is completely speculative — if the Department of Justice insists on charging him, they may need to get United to waive the severance agreement’s clawback provisions in order to secure Smisek’s cooperation. United could be willing, since the airline doesn’t want to be charged, either, in connection with their having provided a private benefit to the bureaucrat overseeing Newark airport (scheduled flight service to and from his weekend home in Columbia, South Carolina which they terminated days after he resigned).
Ironically it’s Smisek, who in the end was the one being extorted by a politician with great power over the success or failure of the airline’s business, that runs the greatest risk here of anyone involved in the Bridgegate scandal:not just legal jeopardy, but as a result of the terms of this severance agreement substantial financial jeopardy as well.
I might even feel sympathy for Smisek’s predicament, had he not taken a cronyist approach himself to using the government to keep out competition. Live by government favors, put yourself in jeopardy via those favors.
And in the end he walks away with big money as long as he can escape prosecution. The big money, though, is all probably worth it just to retire Smisek from United’s safety videos.