Severance Pay

President Obama moved Wednesday to rein in the pay of executives whose companies get taxpayer bailout money -- putting a $500,000 cap on annual compensation, limiting "golden parachutes" to departing bigwigs and requiring corporate boards to adopt policies on luxury expenditures such as lavish entertainment and parties.

Countrywide Financial Corp. founder Angelo Mozilo, one of the nation's highest-paid chief executives, stands to reap $115 million in severance-related pay if his troubled company is acquired by Bank of America Corp., regulatory filings show. Free rides on the company jet are also included in Mozilo's departure deal, and the company will pick up his country club bills until 2011. Other executives, including Home Depot Inc.'

Current and former chief executives of three major U.S. financial institutions hit by sub-prime mortgage fallout were asked Monday by a congressional committee to testify at a hearing next month on their pay and severance packages. A House panel invited Countrywide Financial Corp. CEO Angelo Mozilo, former Citigroup Inc. chief Charles Prince and Stanley O'Neal, former head of Merrill Lynch & Co., to appear Feb. 7.

Countrywide Financial Corp. Chief Executive Angelo Mozilo, under fire over the size of his potential payout from the proposed sale of his troubled mortgage company, says he is forfeiting some $37.5 million in severance pay, fees and perks that he was scheduled to receive upon his retirement. Mozilo, however, will still retain retirement benefits and deferred compensation that he has already earned, Countrywide said in a statement being released today.

Yahoo Inc., owner of the most-visited U.S. website, adopted severance plans for employees that would pay as much as two years of salary to fend off a $44.6-billion bid from Microsoft Corp. Full-time employees would get at least four months of severance pay, and executive officers would get 24 months, Yahoo said Tuesday in a regulatory filing. Employees will be eligible for the payments if they depart within two years of a purchase.

Is David Sambol, the departing president of Countrywide Financial Corp., taking one last joy ride on the company jet? A source close to the company says Sambol is leaving today on a three-week family vacation to Africa on Countrywide's elegant Gulfstream IV. In a telephone interview Friday, Sambol would not confirm the trip, but he didn't dispute it either.

One of the stickier issues to come up in the wrangling over how to bail out the imploding financial system is the question of how much money top executives at investment banks and other publicly traded companies are paid. This is not an idle question. Chief executives at these firms are often paid tens of millions of dollars per year -- so much that their compensation can actually cut into the company's earnings.

Early last year, Alejandro Stephens' long tenure as president of one of California's biggest union locals came to an end after the labor organization he headed merged into a larger local. The Service Employees International Union sweetened Stephens' exit with severance payments and other compensation that totaled nearly $180,000, said union spokeswoman Michelle Ringuette. A condition was that Stephens give up the salary he was receiving from Los Angeles County, Ringuette said.

On the chilly factory floor of the Republic Windows and Doors plant, Apolinar Cabrera and a couple hundred workers have decided to make their stand. Their jobs evaporated Friday when this Chicago company unexpectedly closed its doors, blaming lender Bank of America for cutting off its credit line and preventing it from paying the workers' severance and vacation. Cabrera and his co-workers have refused to leave.

Laid-off workers at Republic Windows & Doors agreed to leave the closed Illinois plant they've been occupying in protest for six days, accepting a deal Wednesday night that will give each of them about $6,000. Workers will receive about eight weeks' severance pay, accrued vacation time and two months of healthcare coverage, officials said. About $1.75 million will be put into an escrow account to be supervised by the workers' union. "The occupation is over.