Before scandal struck and L. Dennis Kozlowski resigned, the Tyco International CEO was one of the nation’s highest-paid executives – a corporate titan who once made $125 million in a single year.
According to Tyco filings with the Securities and Exchange Commission, Kozlowski made a grand total of $300 million in bonuses and pay since he took the helm of the megaconglomorate in 1993.
No one questioned his phenomenal compensation in the go-go 1990s because Tyco stock was soaring and Kozlowski was being billed as a genius on the covers of business magazines. After taking over Tyco, he made acquisition after acquisition and turned the New Hampshire-based company into a $125 billion powerhouse.
Like many big-time CEOs, Kozlowski was showered with largess after making deep cost-saving cuts – including layoffs for rank-and-file workers. That included 6,000 workers in an electronics division who were laid off in November of 2001 – as Kozlowski brought home $41 million in total compensation.
In his most successful year, 2000, the balding, 56-year-old Kozlowski – who grew up middle class in Newark, N.J. and partly put himself through Seton Hall University by playing in a wedding band – made an astronomical $125 million.
That huge haul made him the fourth highest-paid executive in America that year – ahead of such famous corporate leaders as GE’s Jack Welsh, who made $122 million, and Apple Computer’s Steve Jobs, who made $90 million.
All that money does not include his stock options – which may be worthless now because of the tumble Tyco stock has taken in wake of his resignation and questions about the company’s finances.
As if all these riches weren’t enough, Kozlowski had been looking forward to a huge Tyco pension that, after he reached 65, would have given him $343,112 per month. That’s $4.1 million per year and $82 million total if he lives to be 85.
But the circumstances of his resignation have placed the CEO’s pension – and a pricey severance agreement – in doubt. Negotiations are ongoing, though Tyco officials would not comment on them.
There are also investigations into how Kozlowski paid for his boats and houses.
Both Tyco investigators – led by Al Gore’s election lawyer David Boies – and federal regulators are probing to see if company money was used to buy property. The company is also eyeing the boats and how they were purchased.
Kozlowski, who resigned in June, has denied all the charges. He is facing a 12-count tax-evasion indictment that alleges he bought $13 million in paintings but dodged more than $1 million in New York state sales tax by pretending to ship them to New Hampshire.
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