CONTACT: Bruce Kushnick, 212-777-5418 To read the full Compensation Report, go t:o http://www.teletruth.org/docs/compensationFIN.doc To Read the Full Report as a PDF File http://www.teletruth.org/docs/compensationFIN.pdf FOR IMMEDIATE RELEASE: New Special Report: BELLSOUTH, QWEST, VERIZON AND SBC SENIOR MANAGEMENT COMPENSATION: A PRIMER IN CORPORATE GREED. New York --- When it comes to executive pay -- How much is too much? Should phonebill customers pay higher rates, and shareholders receive less dividends to support free personal air travel in corporate jets, lavish apartments in New York City, or "golden parachute" retirement funds worth millions? Is $1-2 billion dollars in stock options and other perks among the top Bell executives in the last three years too much? Some of the Report’s Highlights. Since 1999, the top executives from the Bell companies received an estimated 54 million shares of stock options with an estimated value of $1 –$2.1 billion dollars ---almost 10% of all stock options. As a group, the top 4 executives made $160 million dollars in salaries and bonuses, and an additional 25.5 million shares of stock options, worth an estimated $404 –$818 million in the last three years. Since 1999, Ivan Seidenberg, Verizon’s CEO, made $54 million in salary, bonus and retirement funds, as well as stock options of 2.6 million shares, estimated value between $83-215 million dollars. Seidenberg’s base salary went up 25% over the last three years and his bonuses and "awards" were 1045% above salary. Edward Whitacre, Jr. of SBC made $115 million in salary and stock options, which is 65% of all money paid to SBC’s top executives in the last three years. Joseph Nacchio of Qwest made $36 million in salary in the last three years and the stock options were valued from $238 to $603 million. Executives can get free personal use of aircraft, apartments, spending money for "club" memberships, and "golden parachutes" worth millions of dollars. "The question becomes whether companies that still serve utility functions (who are required to serve the public at ‘fair and reasonable’ rates because of their monopoly status) should be held accountable to their customers and shareholders?" states Bruce Kushnick, Executive Director of New Networks Institute. "Make no mistake about it, someone has to be paying these excessive salaries, stock options and perks, and these expenses are passed on to everyone who uses Bell local phone service or purchases stock in these companies," adds Kushnick. How do the Bell executives get away with these perks? The Bell Tel Retirees (the Retirees of Bell Atlantic and NYNEX) claim that Verizon’s Board of Directors is "infested with conflicts of interest". In their Proxy statements of 2002 they state: "Our Board's lack of independence is unusual among leading public companies. Among S&P 500 companies, 89% have a majority of independent directors, as defined by the Council of Institutional Investors. In contrast, at least eight of Verizon's 16 directors are non-independent. In addition to the two co-CEOs, six outside directors are viewed as non-independent due to board interlocks or because their own employer receives grants, fees, or business from the Company, or did in the recent past." Bell Mergers were senior management perks. When Verizon was formed (created by combining NYNEX, GTE and Bell Atlantic) the senior management greatly benefited. For example, Verizon’s top 6 executives received an "Implementation Executive Incentives", totaling $13 million for the group, while Verizon’s CEOs Ivan Seidenberg and Charles Lee received a "founder’s grant" for a estimated value of $56 million dollars. How much is too much? While the Bell companies complain about their lower profits, it would seem prudent that senior management be held accountable, yet Verizon CEO Seidenberg received 25% salary increases over the last three years and bonuses of over 1000% above salary. Meanwhile, according to the Bell Tel Retirees, many employees with 30 years of service have "not received a pension cost-of-living adjustment in over 10 years, allowing inflation to steadily erode the purchasing power of pensions earned over long careers". "In the last few months, Verizon has increased local phone service in New York 11%, while some services, such as inside wire maintenance went up 225% and payphone calls went up 100%. Next time I’ll think of a Bell executive taking a free trip before I pay my phonebill" adds Kushnick. To read the full Compensation Report, go t:o http://www.teletruth.org/docs/compensationFIN.doc This report is part of "Regional Bells Revenues, Expenditures and Profits" see http://.www.newnetworks.com/profitreport2002.htm For more information, contact Bruce Kushnick at 212-777-5418 or bruce@newnetworks.com