Eagle-Picher Executives Get Big Pay Raises
CINCINNATI (AP) _ Eagle-Picher Industries Inc., which filed for bankruptcy protection in January, gave its five highest-paid executives pay increases of more than 30 percent last year.
Thomas E. Petry, chairman and chief executive officer, received a 37.5 percent raise to $587,916. John W. Painter, president and chief operating officer, received a 38.3 percent increase to $428,750.
The other officers, all senior vice presidents, received raises ranging from 41.5 percent to 31.5 percent.
The raises were reported in The Cincinnati Enquirer.
Eagle-Picher’s net profit last year dropped 27 percent to $39.4 million, but its operating profits - the basis for a portion of the executives’ salary - increased 19 percent to $47.4 million.
John Anderson, a partner with the executive compensation consultant Hewitt Associates, said Eagle-Picher’s case is not unusual. Executive bonuses typically are tied to a measure of operating performance such as pre-tax earnings or earnings from continuing operations rather than a company’s bottom line, he said.
On Jan. 7, Eagle-Picher filed for protection from creditors in U.S. Bankruptcy Court because of massive asbestos liability claims against the Cincinnati firm. The company cited that filing in declining to comment on why the executives received pay raises.
″We don’t think it would be appropriate for us to comment,″ said J. Rodman Nall, vice president.
Daniel W. LeBlond, a member of Eagle-Picher’s board and chairman of its executive compensation committee, referred questions to the company.
In a bankruptcy filing, Eagle-Picher argued for an executive bonus plan this year in order to retain key executives. The plan, which would pay about $2.5 million to 112 key executives who stay for a year, is subject to approval by a federal bankruptcy judge overseeing the company.