Google Chairman Schmidt Tops Equity Awards for Feb.

Every month, Compliance Week publishes a list of the largest stock option grants and restricted stock awards during the previous period. The data and analysis are provided by compensation research firm Equilar.

In February, Google Chairman Eric Schmidt scored a double hit, taking home the largest stock option grant and the largest restricted stock award. Schmidt received 181,840 options on Feb. 2 with a strike price of $612, implying a face value of $111.3 million. He also received 90,920 shares worth $55.6 million, based on a grant-date price of $612. His total haul of equity worth nearly $167 million—at least in face value—is the largest equity package awarded so far this year. Schmidt received the compensation as part of an executive reshuffle Google announced in January, where Schmidt stepped aside from the CEO role, which was taken by company co-founder Larry Page.

The next biggest award went to Coca-Cola Chairman and CEO Muhtar Kent. He received 801,600 stock options on Feb. 17 with a strike price of $64, implying a face value of $51.3 million.

Freeport McMoran Copper & Gold also followed the trend of awarding combination equity packages of restricted stock and options. It gave President and CEO Richard Adkerson 500,000 options on Feb. 8, with a face value of $27.8 million. He also received 139,617 shares of restricted stock worth $7.8 million.  Freeport gave Chairman James Moffett the same package.

Other top equity awards went to Gregory Brown, president and CEO of Motorola Solutions, a provider of emergency radios and bar-code scanners that was recently split from Motorola's mobile phone company; David Cote, chairman and CEO of Honeywell International; and David Snow, Chairman and CEO of Medco Health Solutions.

Trends, Performance

Equilar noted that companies continue to issue performance-based options and equity awards. In February, a number of companies used share price appreciation as the hurdle. For example, Motorola Solutions granted stock options to one executive that carried the following performance-related footnote:

“These options vest in three equal annual installments, each vesting date to be the later of (a) the date on which the average closing price of the company common stock over a 15-day trading period is 10 percent greater than the average closing price of company common stock over the 15-day trading period immediately preceding the date of grant on Feb. 22, 2011, and (b) the first, second, and third anniversary of the grant date.”

Avid Technology also granted performance-based stock options to one executive, but it was much more vague about the hurdles. The footnote read:

“47,500 shares will vest on a performance-based schedule tied to Avid's stock price or the achievement of certain financial metrics; and 27,500 shares will vest on a time-based schedule as follows: 25 percent of the shares will vest on the first anniversary of the grant date and the remaining 75 percent of the shares will vest in 36 equal monthly installments thereafter.”

Only one company granted premium-priced options. Pfizer granted stock appreciation rights to one executive with an exercise price 10.6 percent higher than the company's closing stock price of $18.90.

A downloadable spreadsheet of the top 10 equity awards in February can be found in the box above, right. Also available are data from 2004-2010.