Tuesday March 19, 6:23 pm Eastern Time
Tellabs top officers cut 2001 pay, get no bonuses
CHICAGO, March 19 (Reuters) - Telecommunications equipment maker Tellabs Inc. (NasdaqNM:TLAB - news) gave its top executives no bonuses for 2001 and cut their pay more than 25 percent due to the weak economic conditions that hurt the telecom industry.
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The Chicago area-based company's president and chief executive, Richard Notebaert, received no 2001 bonus and a base salary of $556,733, down 26 percent from the $750,000 salary he is entitled to under his hiring agreement, according to the proxy statement filed by Tellabs with the U.S. Securities and Exchange Commission.
Tellabs said last April, when it announced job cuts, that top executives would have their 2001 pay cut 10 percent or more. The company cut 2,550 jobs, or 29 percent of its work force, last year.
Tellabs and other telecom equipment makers were hurt last year as telephone carriers drastically cut their capital spending amid a slowdown in demand. Tellabs saw its stock fall about 74 percent on the Nasdaq last year.
``Due to economic conditions (in 2001) and the company restructurings, no salary increases occurred,'' the company said in the proxy. ``Additionally, each of the executive officers ... took voluntary salary cuts significantly higher than 10 percent.''
Including other compensation, Notebaert received a total of $646,152 for last year, according to the proxy. He also was awarded 400,000 stock options that are currently worthless because the $16.63 strike price is above Tellabs' current price of $10.63. He did not receive any restricted stock units.
In 2000, Notebaert received a salary of $216,345 and a bonus of $135,000 after he was hired on Sept. 18, 2000, according to the proxy. His total package was worth $357,862 in 2000, with 500,000 stock options granted.
Chairman Michael Birck, who owns 8.6 percent of the company's outstanding stock, also did not receive a bonus and cut his 2001 salary 39 percent to $414,992, according to the proxy. His employment agreement calls for an annual salary of $680,000.
Birck also did not receive any restricted stock units or any stock option grants, according to the proxy. The compensation committee decided not to award any stock options because of his extensive holdings in the company.
Birck's total pay package last year was $646,091, including other compensation, according to the proxy. He received $1.23 million in 2000, including a salary of $652,852 and a bonus of $315,000.
[Harry: TLAB management has always been straight forward and to the point. They are doing the right things in a slow economy. Unfortunately, the cap ex cuts suggested by ONIS is going to hurt TLAB. They did a shift in emphasis to metro products last Q as it appeared to be growing faster than other sectors, so this will not help. It has been supported at 10 due to institutions interest. It will have hard time hold that level as earnings come out. ADTN was downgraded because an analysts felt they would miss the Q. ADTN deploys T1/T2/E3 services. Without demand at the edge there is little need for TLAB's 5500. ] |
