Pay also rises: Sun's top execs get big boosts
San Francisco Business Times
Sun Microsystems Inc. said Wednesday that total compensation for its top two executives ballooned in fiscal 2006, a year in which it cut jobs and regained market share but continued to lose money.
Jonathan Schwartz, who took over as chief executive from founder Scott McNealy, saw his total pay rise to $22.8 million, including the estimated value of options, from about $3 million in 2005.
Sun Chairman McNealy's total pay package for 2006 rose to an estimated $16.5 million in 2006 from about $4.2 million in 2005.
A big part of the pay boost came in the form of restricted stock options, with Schwartz getting an estimated $12.97 million worth and McNealy getting $6.7 million.
Santa Clara-based Sun (NASDAQ: SUNW) also reported in its filing with the Securities and Exchange Commission that Schwartz was granted 2.9 million stock options for fiscal 2006, compared with 800,000 stock options for the previous year. McNealy was granted 3 million, compared to 1.25 million the previous year.
Assuming the company's stock price appreciates 5 percent annually until the options' expiration date, the total value of Schwartz's fiscal 2006 options is $8.4 million, according to the SEC filing. McNealy's 2006 options grant would be worth $8.7 million.
The company said 900,000 of Schwartz and McNealy's 2.9 million stock options have an exercise price of $3.85 a share and expire July 28, 2015. That's about a third below Wednesday's closing price of $5.17.
Schwartz has another 2 million shares and McNealy 2.1 million with an exercise price of $4.95 a share and expiring April 27, 2016.
Silicon Valley/San Jose Business Journal
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