The energy services company that Dick Cheney served for much of the last five years as chairman and chief executive has agreed to let Mr. Cheney, the Republican vice-presidential candidate, retire with a package worth an estimated $20 million, according to people who have reviewed the deal.
The board of the Halliburton Company, which is based in Dallas, approved the arrangements on July 20, five days before Gov. George W. Bush announced his selection of Mr. Cheney as his running mate.
The board's vote allowed Mr. Cheney to avoid a potentially costly aspect of his employment contract, which said he would forfeit some of his compensation if he retired before age 62 without the board's permission. This provision, known as golden handcuffs, is routinely included in executives' contracts to give them incentives to stay.
Mr. Cheney, who spent much of his life as a public official and federal employee, became a wealthy man in his years with Halliburton. He has been paid at least $12.5 million by Halliburton since he joined the company in 1995 and has received stock and options worth nearly $39 million at its current share price.
By permitting Mr. Cheney, who is 59, to treat his departure as early retirement, the directors allowed him to keep $10 million worth of stock and options he would have forfeited had he simply resigned, the company's public filings show. It was not clear whether the $10 million was part of the retirement package or in addition to it.
One of those briefed on the plan said that the board was told the package totaled about $20 million.
While not extraordinarily large by current corporate standards, Mr. Cheney's retirement package solidifies and expands his personal stake in the oil industry in general, and Halliburton in particular, while he is on the campaign trail confronting energy policy issues that will affect Halliburton's performance.
Dirk Vande Beek, Mr. Cheney's campaign spokesman, and a spokeswoman for Halliburton both refused yesterday to confirm any details about the retirement arrangement. Mr. Vande Beek said details were being worked out. Mr. Cheney, he said, will remain an employee of Halliburton until Aug. 16 with the title ''chairman in transition.''
The price of Halliburton stock is substantially higher than it was when Mr. Cheney took over but his tenure was not an unqualified success. The Halliburton board annually sets financial goals for the company with the understanding that executive bonuses will be withheld if the targets are not met. The company failed to meet those targets in both 1998 and 1999, although the board decided to pay Mr. Cheney and other executives bonuses anyway in 1998 because they had engineered a major merger with Dresser Industries, another oil services company. That bonus came to $1.15 million for Mr. Cheney, nearly as much as his $1.18 million salary for the year. In 1999, however, the bonus was withheld.
Mr. Cheney has said in interviews that he will sell off his Halliburton stock if the Republican ticket prevails in the fall. It is not yet clear how Mr. Cheney might handle his stock options, a major part of his wealth, which if retained would give him a stake in the company's performance for years to come.
The options give him the right to buy shares at a set price for up to 10 years. Some of Mr. Cheney's options, however, cannot be exercised before January, unless the board waives restrictions on them. Other options give Mr. Cheney the chance to buy Halliburton stock at more than its current market price of $51 a share, worthless today but potentially valuable if he can hold them until the company's stock rises.
A spokesman for the company, Wendy Hall, declined to discuss Mr. Cheney's retirement. Ms. Hall said that the company allowed some executives to retire with full benefits after age 55 and that details of Mr. Cheney's arrangement would be made public next week.
According to one board member, the package approved for Mr. Cheney was not discounted to reflect either his age or his short tenure.
