Lucent Adopts New Severance Policy
The Wall Street Journal - May 6, 2004
In response to a shareholder vote, Lucent Technologies Inc. on Thursday disclosed that it will seek holder approval in the future for some severance agreements. The new policy requires shareholder approval before the company enters into an employment or severance agreement with an executive officer that provides severance benefits that exceed 2.99 times the executive officer's annual salary and bonus. At the annual shareholders meeting, 65% of the shareholder votes backed a measure related to approval of severance. Lucent said in its quarterly report filed on Thursday that it is implementing that proposal. The policy took effect April 20, but could be changed later, the company said. The company said it also retained a "more restrictive existing policy," adopted in October 2003, that limits the amount of future severance arrangements for any officer to not more than one times salary and annual bonus, plus certain other benefits.