Kodak Pays Execs too much
(March 29, 2003) — Senior executives at Eastman Kodak Co.
were handsomely rewarded for leading the company to the top
of the Dow Jones industrial average last year.
Rochester’s largest employer paid its five top bosses $8.3 million
in salary and bonuses in 2002, roughly double the prior year.
Kodak also handed out special awards of restricted stock to keep
four of the five executives hard at work on State Street.
All in all, Kodak’s senior management earned $14 million in
cash and restricted stock in 2002, up 53 percent from $9.2 million
in 2001. Those figures do not include an estimated value for stock
options because the identities of the top five executives have
changed. Stock option awards in general were decreased in 2002
over the prior year.
Chairman and Chief Executive Officer Daniel A. Carp led the increases.
His total compensation was $9.7 million last year, up 6 percent
from $9.3 million in 2001.
The 2002 figure was boosted by a cash bonus of $2.3 million,
up from just $507,500 in the prior year. It also included
options on 175,000 shares worth an estimated $2.1 million,
according to a formula widely used by compensation experts.
The option grant was down from the prior year.
The value of compensation packages for both Carp and the
four other top executives depend on the company’s performance.
The options could ultimately prove worthless if Kodak’s
stock does not appreciate in value.
Note: Value of restricted stock and stock options may vary widely depending on
performance of company. In fact, stock options may eventually prove worthless
if Kodak shares do not appreciate.
Here are the 2002 compensation packages paid to other top
Eastman Kodak Co. executives:
Robert H. Brust
Chief financial officer Salary: $635,828
Bonus: $669,240
Restricted stock: $424,162
Other (loan forgiveness): $487,768
Estimated value of stock options: $506,240
Total: $2,723,236
Martin M. Coyne
President, Photography Group Salary: $719,692
Bonus: $889,746
Restricted stock: $291,332
Other: $20,953
Estimated value of stock options: $433,920
Total: $2,355,913
Michael P. Morley
Chief administrative officer Salary: $491,154
Bonus: $514,800 Restricted
stock: $368,669
Estimated value of stock options: $421,866
Total: $1,796,489
Daniel P. Palumbo
President, Consumer Imaging Salary:
$514,154 Bonus: $517,195
Restricted stock: $365,915
Estimated value of stock options: $438,741
Total: $1,836,005
Can You Say OINK !!!
— Daniel A. Carp’s total compensation fell by more than 50 percent last year.
By Ben Rand
Staff writer
(April 5, 2004)
Daniel A. Carp’s total compensation fell by more than 50 percent
last year as Eastman Kodak Co. reduced bonuses and instituted an
overhaul of its pay policy to top executives.
The chairman and chief executive of Rochester’s largest employer
received a package worth an estimated $4.4 million in 2003,
down 54.2 percent from the prior year. Kodak met its goals for
revenue and profit last year but was also the worst-performing
stock in the Dow Jones Industrial Average.
Carp’s package is made up of salary, bonus, shares of stock
and stock options. Kodak gave Carp a slight raise in salary to
$1.08 million to keep his pay in line with executives at peer companies.
His bonus of $1.9 million was down 18 percent.
A significant part of the drop is tied to a change in Kodak’s pay
policies. The company will attempt to de-emphasize the use of stock
options for Carp and the company’s most senior executives. Carp
received options on 72,000 shares worth an estimated $587,760 in 2003.
A year ago, Kodak gave Carp options on 175,000 shares worth an estimated $2.1 million.
Attaching a value to stock options is an inexact science. The options
are tied to a preset price. If the company’s stock doesn’t rise above
that price within a seven-year period, the options expire and the
executive receives nothing.
In place of options, Kodak will offer the executives a chance to
earn shares of Kodak stock outright by meeting company goals for
earnings per share over two years. The stock will also have a yearlong
waiting period before they become property of the executive.
The pay for Carp covers what is shaping up to be a decisive year in
Kodak’s history. The company is pursuing a strategy for surviving
the switch from film to digital imaging. As part of the strategy,
the company had announced in January that it would eliminate
12,000 to 15,000 jobs worldwide over three years.
BRAND@DemocratandChronicle.com
This is so sad.
I REALLY feel sorry for him !
Dave