NEW YORK -- Ousted as president and co-chief executive of Time Warner Inc. in February because of poor performance, N.J. Nicholas Jr. is getting a parting deal from the company that almost makes losing one's job an enviable proposition.
"It's a very generous amount, and probably one of the largest that we have seen," said Joseph E. Bachelder, a lawyer who specializes in executive compensation matters.
Here's why: Mr. Nicholas' employment contract entitled him to $15.8 million in severance, about what he would have made had he remained in his job through 1999.
That lump-sum payment was confirmed this week in company documents filed with the Securities and Exchange Commission.
Despite his ouster as an officer and director, the filing states that Mr. Nicholas will be kept on the payroll "as an employee" at $250,000 a year until July 1999. That will preserve his $600,000-a-year pension and his benefits, and enable him eventually to cash in 500,000 options, worth $8 million today.
He would also probably benefit from the 48,000 shares of stock, worth $5 million at current prices, previously issued to him on a restricted basis.
"If they terminated him, they could have severed him completely, and they didn't," Mr. Bachelder said, referring to the company's board. "It was their choice to keep him on the payroll."
All of the money comes on top of the $2.9 million of salary, bonus and deferred compensation that Mr. Nicholas received in 1991 -- a $538,000 raise from 1990.
The company has also agreed to provide Mr. Nicholas with a secretary, an office and $6 million of life insurance through 1994.