Agreement spells out payments to Shattuck

December 20, 2005|By M. WILLIAM SALGANIK

According to the latest agreement, if Mayo A. Shattuck III, CEO of Constellation Energy Group Inc. and future chairman of FPL Group Inc., leaves the merged company:

Within the first year after the deal closes, he would get $15 million in cash, if he's dismissed or leaves after his duties are reduced.

After the first year, the cash severance would drop to $5 million, if he leaves within three years under those same conditions.

But while his severance would drop after the one-year mark, he would also get a stock grant equal to the amount of his cash severance under his old agreement. He'd get his stock even if he leaves during the three-year severance period.

The value of the stock grant would be three times his annual salary - which is $1 million, according the company's most recent proxy statement - plus the average of his two largest incentive payments, according to the Dec. 14 filing. He got a $4 million incentive bonus in 2004, according to the 2005 proxy.

If he stays, he would collect:

His unchanged base salary in 2006, plus a bonus to be set by the old Constellation board.

Salary and bonus of $5 million in 2007 and $2.5 million in each of 2008 and 2009 - but in no case less than the CEO of the merged company. He would also be eligible for incentives, benefits and perks "at least as favorable as those provided to the CEO of the Company."

His stock grant.

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