Back in February 2004, C. John Wilder left Entergy Corp., where he served as executive vice president and CFO. Wilder’s destination: TXU Corp, where Wilder would take over as president and CEO.
It turns out Wilder’s switch was a very prudent move. In his first year at TXU (ten months, actually), Wilder earned more than $55 million. That’s right. $55 million.
The TXU president also made $3.65 million after exercising Entergy stock options in 2004. This came on top of the more than $106,000 in salary for his roughly eight weeks that he served at his former employer in calendar 2004.
All told, Wilder’s total 2004 compensation from TXU and Entergy worked out to nearly 20 times what he earned in 2003—his final full year with Entergy—when he took home a total of $3 million, including more than $1 million in gains from exercising stock options.
To be sure, Wilder’s performance at TXU appears to have been stellar. He was brought in by the company’s board to revive the utility and its stock price, both of which had taken a beating after the company’s European operations collapsed in 2002.
Since Wilder took over, the price of TXU shares has more than tripled, to an all-time high of $80 or so.
Still, Wilder wasn’t directly rewarded for this accomplishment. Rather, his haul in 2004 was mostly the result of his negotiating skills. Indeed, his big payday actually stems from the deal he struck before he joined the company.
That deal includes $36.9 million from the vesting of 1 million long-term incentive plan performance units as part of his employment contract. The units vested when the market price of the company’s stock equaled or exceeded $29, $31, and $33, respectively, for 30 consecutive trading days. The stock traded around $28 a share when Wilder joined the company.
He also earned a $15.9 million bonus, which includes a $1 million signing bonus and a grant of 500,000 shares to a rabbi trust. Those shares will be distributed to Wilder in equal portions on the third and sixth anniversaries of his agreement, according to the company’s proxy.
Earlier this year, the utility holding company agreed to sweeping corporate governance changes as part of a class-action lawsuit settlement with its shareholders. The changes included the replacement of two board members and the creation of a lead independent director.