posted 06-07-2001 03:12 PM               

Florida Power & Light Co. customers ought to be enraged now that we know company executives pay themselves unjustifiably high salaries and bonuses. During merger talks with Entergy Corp., FPL officers invoked "change of control" clauses in their contracts, triggering early payments as an incentive for the executives to stay with FPL after the merger, even though their future with the new combined utility might be uncertain.

"Change of control" bonuses are common in American corporations, an inducement for management to stay and keep the company running during a transition to new ownership. It would be disastrous for a company like FPL to operate for months without leadership. It is equally disastrous for the officers to pay themselves $60 million in "change of control" bonuses ‹ then cancel the merger and keep the money.

FPL chairman and chief executive James Broadhead receives a salary of $974,000, along with $1.1 million in performance bonuses and $13.5 million in accrued retirement benefits.

It is difficult to justify that level of compensation for anyone.

But it is impossible to justify Broadhead keeping $21.1 million of the total $60 million paid to the seven top FPL executives.

The FPL payments were highly unusual because the lump sums were paid well in advance of the deal's completion, which was expected in late 2001. Most comparable "change of control" payments at other companies, including Entergy, are triggered by the closing of an acquisition.

FPL's "change of control" clause has become an "out of control" raid on the company's assets.

The Associated Press, reporting on the bonuses, said Broadhead defended the payments during a conference call with utility stock analysts and institutional investors. He has no intention of giving back the windfall.

Merrill Lynch Investment Managers fund manager Bill Paster told Broadhead during the call that the money should be returned. "It's the right thing to do, Jim," said Paster, whose firm owns 907,445 shares of FPL stock. "Well, that's your opinion I guess," Broadhead retorted.

That is our opinion, too, and should be the opinion of every stockholder.

There is no excuse for the corporate greed Broadhead is trying to defend. Florida Power & Light needs leadership that exhibits good business sense and fairness.

James Broadhead deserves to get the boot, even if he goes out the door with $1.1 million in performance bonuses and $13.5 million in accrued retirement benefits.