Ex-Nortel CEO seeks $12M from bankrupt company

Zafirovski says contract entitles him to millions; shareholders not getting any payback

Former Nortel CEO Mike Zafirovski is seeking more that $12 million from the bankrupt company, according to a filing in the US Bankruptcy Court for the District of Delaware.

Zafirovski, who failed to turn around the once venerable telecom giant after an accounting scandal, a series of financial restatements and the economic recession, wants no less than $12,250,543.48 from Nortel. Nortel filed for bankruptcy in January, began liquidating assets in June, and saw Zafirovski resign in August.

The breakdown of the payout is:

• $2.4 million in base salary for 24 months

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Former Nortel CEO Mike Zafirovski is seeking more that $12 million from the bankrupt company, according to a filing in the US Bankruptcy Court for the District of Delaware.

Zafirovski, who failed to turn around the once venerable telecom giant after an accounting scandal, a series of financial restatements and the economic recession, wants no less than $12,250,543.48 from Nortel. Nortel filed for bankruptcy in January, began liquidating assets in June, and saw Zafirovski resign in August.

The breakdown of the payout is:

• $2.4 million in base salary for 24 months

• $3.6 million in bonuses

• $200,543.48 pro rata bonus for the third quarter of 2009

• $50,000 in insurance benefits

• And $6 million in a lump sum annuity.

SLIDESHOW: CEO payday: How much tech chiefs made in '08

Zafirovski claims his 2005 employment contract with Nortel entitles him to the millions. As Nortel sheds its businesses and assets, shareholders are not receiving any payback from their investments.

The blogosphere is expressing its disgust. All About Nortel’s Mark Evans says "As Nortel continues to disappear, the stream of head-shaking news continues to emerge."

And Billingworld.com says it is "at a loss for words over Zafirovski’s claim except to say that this is truly tool-like behavior."

Nortel declined to comment.

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