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Executives Follow Corporate Lead

Filing: Countrywide CEO to get $10M
last updated: March 29, 2008 04:32:07 PM
LOS ANGELES

Countrywide Financial Corp.'s chief executive and president will receive a combined $19 million in stock next week as part of the company's pending takeover by Bank of America Corp., according to a regulatory filing.

The payments of stock valued at $10 million for chief executive Angelo Mozilo and $9 million for President David Sambol were disclosed in a regulatory filing late Thursday by Bank of America.
The payments, described as "performance-based" stock rights and grants, are required by agreements the executives struck with Countrywide less than a year before the sub-prime meltdown forced the mortgage lender to sell itself, according to the filing.
Some lawmakers were incensed by the payouts.

"It's perverse for Bank of America to reward the principal architects of the bad business practices that caused this housing crisis," Sen. Charles Schumer, D-N.Y, said in a statement.

Mozilo, who is expected to retire after the takeover, previously agreed to give up $36.4 million in cash severance benefits. But after his departure he will receive company-paid life and health benefits worth $21,084 and medical benefits worth an estimated $85,000.

Bank of America also disclosed in the filing that it would pay Sambol $28 million to stay with the company. The bank wants Sambol to lead its consumer mortgage business when the deal is complete.

Bank of America is in the process of acquiring California-based Countrywide for about $4 billion in stock. Bank of America agreed to the acquisition in January, and the transaction is expected to close in the third quarter.

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Posters Comments: What should have been a prison term ended up being a gold mine at the tax payers expensive. See any similaries here with the LLNS take over?

Extra! Extra! LLNL is hiring,

LLNL is hiring, hmmm preferably outside applicants!

Hey Miller, can you hear?

This comment was misplaced under "RIF tally"; I feel, it should be a post by itself!
If George cannot hear this, he will never anything else:

Here we fo:

Time is running out on LLNS and George.

Until recently, employees have withheld judgement, to see how LLNS would restructure the lab. They have now seen enough to predict failure. The facts look bad.

1. LLNS management does not have command of information. This has made Miller's proclamations a source of ridicule.
a. "No layoffs in first year"
b."substantially equivalent"
c."We can cover the costs of transition without staff reductions"
d. "Leidle will lead a team to save $30M."
e. " We need to recover $80M... ah $280M, ah...."

2. The $50M/year fee to access the best practices of industry is wasted.
a. Bechtel, Battelle and BWXT have provided nothing of value. The senior industrial replacements brought nothing but themselves. They ask questions to try to solve problems, but provide nothing intrinsic or improved for the $50M/year fee.
b. LLNL was to implement industry best practice top to bottom accounting systems and practices...
b. and industry standard, improved project management software integrated seamlessly into the financial accounting system...
c. and standard IT practices...
d. and industry-best program development practices...
e. Formerly effective and decisive lab leaders are now waiting for their industrial partners to act decisively and effectively. But the new industrial leaders, alone, inexperienced and without the industrial infrastructure to support them, are unable to see their way forward. Little is getting done, except a reshuffling of the organization charts.

3. Miller is surrounded by folks inferior to those UC provided.
a. Leidle is no Mara, etc., The new practices in human resources are a retention timebomb.
b. Many folks in 111 are not trained for the jobs they hold, nor familiar with industrial practices, because they are experienced only in the unique public sector/government contractor relationship UC and NNSA developed under years of contract 48. They cannot initiate effective change, they do not even understand the basic principles.

5. There are no resources to pay for change. This significant organizational experiment, tearing down one system and standing up a replacement has a price.
a. Yet $280M is pulled out to waste on non-productive costs.
b. Miller is now raiding programs to pay for transition costs by reducing support to programs without reducing the burden rates, effectively increasing the cost of doing business.
c. No capital is provided to pay for the necessary changes.

6. Throughout the lab, employees lack confidence.
a. Awaiting better (industrial) leadership, they now wait rather than act. Decisions are deferred, innovation has ceased, awaiting directions that do not come.
b. Morale for these formerly effective, dynamic high-achievers is at an all time low, seriously affecting productivity. Retention will follow.(Try to find a leader not on vacation last week)

In short, the Bodman/D'Agostino organizational experiment, like Cheney's Iraq adventures, has been done on the cheap, without adequate thought to the long-term consequences. THEY DIRECTED THE DESTRUCTION OF THE EXISTING INFRASTRUCURE WITHOUT THOUGHT AS TO HOW TO REPLACE IT. The result is likely to be a stumbling, crippled ineffective organization for a long time, hidden from the public by Susan Houghton's spinmeisters.

Iraq, Mortgage bubble, destruction of the national labs.
Not a bad record for a President....

Open letter to George

Contributed by anonymous



Dear George,

It is time for a real incentive.
LLNS has not been effective in understanding its situation or responding realistically. The expectation that 750 people would take the VSSOP incentive shows that you are getting terrible advice.

You have a serious short-term operating financial shortfall, even as you are expected to implement new costly infrastructure changes. Time to be hard-nosed and to think realistically.

You can fire 750-1000 people based on seniority. This will retain obsolete, highly-paid, tired personnel while releasing the lab's future.

Or you can structure a realistic incentive that will select the high-paid, while retaining the younger, cheaper, more energetic.

Consider. 750 folks is 10% of the labs population. About 15% of the the population is over 55 years old. Construct an incentive to move those people out. This means giving them the amount they will recieve at full-retirement (age 60), minus some amount for getting out early. Maybe 50% of the cost would do it. This might mean offering an incentive that is the equivalent of 1-2 years of service as an annuity that can be financed over time. SINCE IT RESULTS IN LONG-TERM DEFERRED SAVINGS, THE ANNUITY NEED NOT BE PAID ALL AT ONCE, BUT CAN BE FINANCED THROUGH SAVINGS IN REDUCED PAYROLL OVER MANY YEARS.

This is a tool that will allow you to get what you want. The deadheads that surround you may not tell you, but King George,you need this (unless you are bailing soon).

How do YOU feel about the economy?

Several people made comments under other posts that merit their own topic.
Here they are with a few comments.

Anonymous said...


I now understand why people who paid $500K+ for their homes which are well on their way down to a value of $250K or less are just plan walk away from their debt. These people know that it may take their entire life to break even, and since making money is the name of the game their situation is a zero sum game. They are had goose.
March 28, 2008 7:21 AM
Anonymous said...

Just because one's home value goes down is no reason to walk away from it. There should be severe penalties for doing so. The selfish actions of a few are making it hard on the rest of us (e.g., 401k goes down, housing prices are depressed further, etc.), spiraling the economy towards a possible depression.
March 28, 2008 10:05 AM
Anonymous said...

March 28, 2008 10:05 AM

It's just as March 28, 2008 7:21 AM said.

No body in their right mind is going to stay when they know they'll possibly never in their lifetime get what they paid for the house. It's a bad investment and houses now days are not homes nor do the people who own them care about developing a community. They are there for the profit and then to move onto a bigger and better _house_. These people are just short time acquaintances that come and go faster than some of us change our underwear. This is one of the reasons I don't bother to get to know my neighbor or tell them much about me if anything but I make it a point to find out all I can about them. There's just no one who's going to be around for a while, like 20-30 years or maybe for their entire life in the same home, as it use to be. Long term environments are gone and can only be found in small towns where peoples values are entirely different.

Anyway just to let you know a game a family from India is playing with the bank.

As you well know they normally live with at least three to four families under one roof where the garage becomes the dining room and each floor of the house is an apartment, where each family pays 1/4 the mortgage. This particular family bought a _house_at ~$650 - $750K. The house in now on the market and only valued at $500K or less. The families could see they were never going to regain their $750K plus so they walk away.

They then got one of the other relatives that lived in that home to buy a bigger foreclosure two block away and they all moved into it.

They let the bank eat the $250K +, got a bigger and better home for less than $500K. Do they care if their credit is hurt.

Nope, because they have no intention of buying another house and the house they lived in now is in someone else name, and they aren't legally obligated to pay the mortgage.

So there you go. It thinking like this from foreign nations that'll bring down America. Welcome to immigration control and the politically correct compassionate an understanding way of thinking.

I hope you feel sorry for these folks. They are, after all destitute foriegn nationals who probably aren't US citizen and still will get social security that you paid for in the end.
March 28, 2008 2:24 PM
Anonymous said...

March 28, 2008 2:24 PM

You got to give those foreign national credit for creative thinking, but when it comes to honor and self respect they get a mark of -100 on my scale. They have neither . But then in todays world neither of these virtues counts, they've been lost in just two generations of unworthy children and moronic parents who taught their children nothing of value except that money grows on tree, easy come easy go and there's no dishonor in being in debt up to your ears and not paying your bills on time. When times are hard just file bankruptcy and let the next generation pay for your greed and non disciplinary way of life.
March 28, 2008 5:47 PM

New 3161 To Long To Wait

I brought this to the top to give some of you people an idea of how others who you work along side every date feel. Here was their entry.

"It's too much work to do another 3161."

Question: How long is the 3161 plan good for? One round of layoffs? What if they change the rules and do away with the career status and therefore everyone is a flexterm?