HP this week revealed that former CEO Mark Hurd received $23.9 million in compensation in its most recent fiscal year, a year that saw Hurd resign following a sexual harassment allegation in August.
In a report filed Tuesday with the SEC, HP disclosed details about the compensation received by its former, current and interim CEOs during its 2010 fiscal year, which ended Oct. 31. Hurd's tally of $23.9 million represents a decline of 19% compared to the $29.5 million Hurd netted in 2009.
Hurd resigned on Aug. 6 following a sexual harassment allegation and an internal investigation that determined he had violated HP's standards of business conduct.
Roughly half of Hurd's total compensation in 2010 is attributed to the $12.2 million severance payment he received following his resignation. The remainder consists of his $1.1 million salary, stock awards valued at $9.9 million, and $632,683 in perks and other compensation. (Hurd's perks include $362,899 for home security services and $158,816 for personal aircraft usage.)
Hurd -- who is now a co-president at Oracle -- might have left with a lot more had his original severance package remained in place.
At the time of his resignation, Hurd and HP signed a "separation agreement and release" that called for a $12.2 million severance payment in cash, plus the option to exercise outstanding equity awards. Some estimates put the value of the severance package as high as $53 million, leading outraged shareholders to sue. A subsequent legal settlement resulting from a lawsuit HP filed against Hurd after he joined Oracle led to the cancellation of Hurd's outstanding equity awards.
"In connection with the settlement of litigation subsequently commenced by HP against Mr. Hurd, all of his outstanding equity awards were canceled," HP says in its proxy statement.
The proxy statement also reiterates details of current HP President and CEO Leo Apotheker's four-year employment agreement. Apotheker took the reins from interim CEO Cathie Lesjak on Nov. 1, the first day of HP's 2011 fiscal year.
According to the agreement, Apotheker will receive base pay of $1.2 million and a target annual bonus equal to at least $2.4 million and up to as much as $6 million. Apotheker also received a $4 million cash signing bonus plus an additional $4.6 million reimbursement for payments he won't be getting from his former employer (SAP) and to cover his relocation expenses, HP says.
The bulk of Apotheker's compensation, however, will come in the form of performance-based bonuses, restricted shares and stock awards that could be worth tens of millions of dollars as they vest over the next three years.
As for Lesjak, now HP's CFO, her total 2010 compensation amounted to $8.1 million. She received a $610,000 salary, $2.6 million bonus, stock awards valued at $3.5 million, a performance-based cash bonus of $940,925, pension benefit changes amounting to $366,363, and perks and other compensation totaling $84,034.
Her $8.1 million package represents a decrease of 1% compared to her total pay in 2009, despite the fact that she received some bonuses ($1 million cash and $2.6 million worth of equity awards) in recognition of her service as interim CEO. The extras weren't enough to top the $8.2 million pay package Lesjak netted in 2009, however.
HP reported revenue and profit gains of 10% and 14%, respectively, for its 2010 fiscal year. Revenue hit $126 billion, up from $114.6 billion in 2009. Profit grew to $8.8 billion from $7.7 billion a year earlier.