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Bausch Withholds Bonus From Its Chief Executive

Firm chooses to forgo $1.1-million payment rather than accept resignation for false claim of graduating from business school.

October 30, 2002|From Associated Press

Bausch & Lomb Inc. is withholding a $1.1-million bonus it had promised Chief Executive Ron Zarrella rather than accept his offer to resign for falsely claiming that he had graduated from business school.

The eye-care products maker's board of directors said in a letter to Zarrella on Tuesday that "this lapse in judgment with regard to your biography is a serious matter and cannot pass without consequence."

Citing its responsibilities to shareholders and 12,000 employees, the board said Zarrella would forfeit an incentive bonus of at least $1.1 million that it had agreed to pay him for 2002 when he was hired last November.

Zarrella, 53, offered to resign Monday for "the misrepresentation in my official biography" that claimed he had graduated from New York University's Stern School of Business in 1978. Zarrella attended the MBA program from 1972 to 1976 but left without graduating.

Zarrella said he was "anxious to assure" the company that the inaccuracy "is not indicative of a pattern of behavior."

"Quite the contrary, it stands out as a singular and uncharacteristic lapse in judgment that I hope I can overcome in time," he wrote.

The board decided that a management change wasn't necessary, saying that the firm's fortunes had improved. "We continue to believe you are the right person to carry on the resurgence of the company," it said.

"We make this decision, in part, on your unqualified representation that there is no other issue of trust or veracity about which we need to be concerned," it added.

Bausch & Lomb's stock briefly dropped almost 7% on Thursday when the discrepancy was disclosed in TheStreet.com.

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