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Technology Stocks : Dell Technologies Inc. -- Ignore unavailable to you. Want to Upgrade?

To: Chuzzlewit who wrote (122545)	5/5/1999 4:50:00 PM
From: H.A.M.	Read Replies (2) \| Respond to of 176387

Dell's CEO Michael Dell Got $105 Mln of Stock Options Washington, May 5 (Bloomberg) -- Dell Computer Corp., the top direct seller of personal computers, tripled founder Michael Dell's pay to almost $109 million during its last fiscal year. The 34-year-old executive's compensation included stock options valued at more than $105 million. That added one of corporate America's biggest paychecks to a fortune that already ranked Dell as the fourth-richest person in the U.S. ''He might have the highest package of all,'' said Graef Crystal, an executive compensation expert. The company said Dell's compensation recognizes his ''leadership and vision'' in boosting stock prices at the company, based near Austin in Round Rock, Texas. Dell's shares quadrupled during the fiscal year that ended Jan. 29, amid robust sales to corporate and government customers and strong sales over the Internet. Dell was the second-best performing stock in the Standard & Poor's 500 Index during the 12 months ending in January, trailing only America Online Inc. Dell's fiscal 1999 pay was outlined in a proxy statement filed with the U.S. Securities and Exchange Commission. A year earlier, Dell was paid about $36.4 million. Most Highly Paid Executive compensation packages can be difficult to compare, because companies use different combinations of cash, along with stock and options and other incentives that can be valued in different ways. Still, Dell probably rivals Citigroup Inc.'s 66-year-old co- chairman Sanford Weill for most highly paid U.S. executive, Crystal said. Weill took home $208.7 million in 1998, including $156.6 million he made by exercising previously granted stock options. Dell exercised no options during his company's most recent fiscal year. Dell, who started the computer business in his University of Texas dormitory room in 1984, owned almost 365 million company shares at the end of last month, including options due to vest within 60 days. That stock is worth more than $15 billion at current prices. Dell's wife and two family trusts owned another 49.5 million shares worth about $2 billion, the filing said. As of Jan. 29, Dell held unexercised options to buy another 40 million shares. Dell's stock holdings catapulted him to the No. 4 spot on Forbes magazine's 1998 list of the 400 wealthiest people in the U.S., from the No. 16 spot a year earlier. Dell got a $2.6 million bonus during the most recent fiscal year, up from $2 million a year earlier. He received an $844,231 salary, up from $788,462 the previous year. ''Employees at Dell are rewarded only when we contribute to those things that influence value creation or very specifically when the value of Dell stock appreciates, and it has done so very nicely,'' said T.R. Reid, a Dell spokesman. ''Mr. Dell is compensated as a high-achieving chairman and chief executive officer.'' Options Grant Dell's options grants last year included 8 million options that let him buy company shares for $16.67 apiece, and another 4.8 million options to buy stock for $28.90 per share, the proxy filing said. Dell shares have more than doubled since the first batch of options was awarded on March 5, 1998. Company shares rose 7/16 to 41 1/4 in recent trading. Dell lists the value of an executive's options using a formula to estimate the value of options on the day the board awarded them. Dell's formula, though, reduces the estimated worth by 25 percent to reflect the chances that employees might leave the company before the options vest. Because Dell, the company founder, isn't likely to leave, the actual value of his options grant is probably higher, said Crystal. ''The probability of a CEO ever losing his options rivals that of being hit by lightning,'' Crystal said. ''He is Michael Dell. His name is over the front door. Where is he going?'' Dell's options grant represented more than 21 percent of the total options awarded to employees in fiscal 1999, according to the filing. Dell received almost 15 percent of the company's total options in fiscal 1998, according to a previous filing. Stock options are a common and significant part of pay packages at high-tech companies. Options let the holder buy shares from the company at a pre-set exercise price. If shares rise above that price, the option holder can sell stock and profit from the difference. Because the SEC lets companies use different methods to estimate the value of options granted to their executives, it is difficult to compare executive pay from one company to another, even if they're in the same industry. May/05/1999 16:13