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9 Gigantic Bonuses That Make Yours Look Like Chump Change

Big bonuses are back. Nine tech CEOs received cash bonuses of $3 million or more in 2010, and another 13 netted at least $1 million in bonus money, according to our analysis of tech execs' pay packages.

[CEO PAYDAY: What tech's top execs raked in for 2010]

Across all industries, CEO compensation had tapered off the last couple of years but came climbing back in 2010. In particular, cash bonuses grew significantly, according to The Wall Street Journal/Hay Group 2010 CEO Compensation Study.

The study, which looks at compensation for CEOs at 350 of the largest U.S. companies, found that base salaries remained flat at $1.1 million - but annual incentive-based bonuses increased by 19.7% to $2.2 million. The sharp gains in bonus amounts led to a 12.8% increase in overall cash compensation.

Among 38 pay packages that Network World examined, IBM CEO Sam Palmisano pocketed the largest cash bonus -- $9 million - in a year that saw IBM achieve record profit and surpass its earnings-per-share goals. Here are the details on the nine biggest cash bonuses in our tech-focused tallies, plus a list of 13 other tech execs whose bonuses exceeded $1 million.

ibm
Who: IBM CEO Sam Palmisano

Bonus amount: $9 million

Total 2010 compensation: $31.7 million

Company performance: IBM grew revenue and income by 4% and 10%, respectively, in its 2010 fiscal year ended Dec. 31. Revenue came in at $99.9 billion, up from $95.8 billion in 2009. Net income hit $14.8 billion, up from $13.4 billion.

Justification for bonus: IBM CEO Sam Palmisano's $9 million award represents an 89% increase over the $4.8 million bonus he received in 2009. In justifying the bonus, IBM cited a number of favorable results achieved in 2010, including: record profit and cash flow; earnings-per-share of $11.52, surpassing the high end of its EPS target set back in 2007; and 17 acquisitions for $6.5 billion.

oracle
Who: Oracle CEO Larry Ellison

Bonus amount: $6.5 million

Total 2010 compensation: $70.1 million

Company performance: Oracle grew revenue 15% -- from $23.3 billion in 2009 to $26.8 billion in 2010 - in its fiscal year ended May 31, 2010. Net income climbed 10% from $5.6 billion to $6.1 billion.

Justification for bonus: Oracle awarded Larry Ellison a $6.5 million bonus, up significantly from the $3.6 million he netted in 2009. "For fiscal 2010, our named executive officers each received a cash bonus ... that was approximately 155% of their target bonuses and were paid an average of 78% more than the bonus amounts they were paid in fiscal 2009," Oracle said in its proxy statement. The big increase is because the company's non-GAAP pre-tax profits grew significantly during fiscal 2010 and exceeded the target levels set by the compensation committee, Oracle says.

motorola
Who: Motorola Solutions CEO Greg Brown

Bonus amount: $5.9 million

Total 2010 compensation: $13.7 million

Company performance: Motorola Solutions CEO Greg Brown and Motorola Mobility CEO Sanjay Jha oversaw Motorola's split into two separate companies, which was finalized in January of this year.

Justification for bonus: Brown, who runs the enterprise-focused Motorola Solutions, pocketed a $5.9 million bonus for 2010, far surpassing the $836,931 bonus he earned a year earlier. Motorola said the bigger payouts under its incentive plan are due to improved financial performance, including an increase in net sales and operating earnings (the company's operating earnings rose to $789 million in 2010, compared to an operating loss of $492 million in 2009).

[BY THE NUMBERS: Perks drive up pay for tech CEOs]

Next page: At&T, Apple, Cisco, Sprint, Verizon, Symantec

att
Who: AT&T CEO Randall Stephenson

Bonus amount: $5.1 million

Total 2010 compensation: $27.3 million

Company performance: AT&T grew revenue and income by 1.4% and 64%, respectively, in 2010. AT&T's revenue came in at $124.3 billion, up from $122.5 billion in 2009. Net income attributable to AT&T hit $19.9 billion, up from $12.1 billion in the prior year.

Justification for bonus: Randall Stephenson collected a $5.1 million cash bonus in 2010, which is 100% of his targeted bonus but down 14% from the $5.9 million he netted the prior year. AT&T specified three performance metrics -- consolidated revenues, earnings per share, and free cash flow -- and related target ranges that its executives were expected to achieve in 2010. "Under Mr. Stephenson's leadership, AT&T grew consolidated revenues, increased reported earnings per share 63% and delivered a strong performance across a number of key categories," the company said in its proxy statement.

apple
Who: Apple COO Tim Cook

Bonus amount: $5 million

Total 2010 compensation: $59.1 million

Company performance: Apple grew revenue and income by 52% and 70%, respectively, in its 2010 fiscal year ended Sept. 25. Revenue came in at $65.2 billion, up from $42.9 billion in 2009. Net income hit $14 billion, up from $8.2 billion.

Justification for bonus: After stepping in as CEO during Steve Jobs' 2009 medical leave of absence, Apple COO Tim Cook received a one-time $5 million cash bonus. "In awarding this bonus, the Compensation Committee considered Mr. Jobs's recommendation, the Company's strong financial performance in 2009, and the importance of Mr. Cook's ongoing contributions to, and retention by, the Company," Apple said in its proxy statement.

cisco
Who: Cisco CEO John Chambers

Bonus amount: $4.6 million

Total 2010 compensation: $18.9 million

Company performance: Cisco grew revenue and income by 11% and 27%, respectively, in its 2010 fiscal year ended July 31. Revenue came in at $40 billion, up from $36.1 billion in 2009. Net income hit $7.8 billion, up from $6.1 billion.

Justification for bonus: John Chambers' $4.6 million cash bonus is more than double the $2 million bonus he received a year earlier. Cisco based its 2010 cash incentive awards on worldwide revenue and operating income growth, which exceeded targets by 9.5% and 21%, respectively, Cisco said in its proxy statement. "Variable cash incentive awards for fiscal 2010 ... for the named executive officers ranged from 160% to 205% of target, reflecting above-target economic performance for the fiscal year."

sprint
Who: Sprint Nextel CEO Dan Hesse

Bonus amount: $4.4 million

Total 2010 compensation: $9.1 million

Company performance: Sprint Nextel saw a slight uptick in revenue but a wider net loss in its 2010 fiscal year ended Dec. 31. Operating revenue came in at $32.6 billion, up 1% from $32.3 billion in 2009. Sprint Nextel reported a net loss of $3.5 billion in 2010, compared to $2.4 billion in the prior year.

Justification for bonus: Sprint Nextel CEO Dan Hesse's $4.4 million bonus is more than triple the $1.3 million he received in 2009. Sprints says its 2010 incentive plans were focused on driving turnaround efforts, and the company compensated executives for delivering results in postpaid subscriber churn, 4G subscriber additions, net service revenue, operating income and free cash flow.

verizon
Who: Verizon CEO Ivan Seidenberg

Bonus amount: $3.9 million

Total 2010 compensation: $18.2 million

Company performance: Verizon's revenue and income fell 1% and 12%, respectively, in its 2010 fiscal year ended Dec. 31. Verizon reported operating revenues of $106.5 billion, down from $107.8 billion in 2009. Net income came in at $10.2 billion, down from $11.6 billion a year earlier.

Justification for bonus: Ivan Seidenberg picked up a $3.9 million cash bonus for 2010 after netting $3 million a year earlier. He earned 100% of his target award, which was based on the following performance measures: adjusted earnings per share, revenue, free cash flow and diversity. In explaining its performance metrics, Verizon noted that the diversity target is measured "by the percentage of new hires and promotions at and above the manager level consisting of minority and female candidates and the levels of supplier spending at the corporate level to minority- and female-owned or operated firms."

symantec
Who: Symantec CEO Enrique Salem

Bonus amount: $3.1 million

Total 2010 compensation: $9 million

Company performance: Symantec reported a 3% drop in revenue while reversing a net loss for its fiscal year ended April 2, 2010. Revenue came in at $5.99 billion, down from $6.15 billion in 2009. Net income hit $714 million, compared to a net loss of $6.8 billion in 2009.

Justification for bonus: At Symantec, CEO Enrique Salem pocketed a $3.1 million bonus for 2010, which is more than double the $1.2 million cash bonus he got the year before but less than what he might have earned. "For fiscal 2010, each of our named executive officers received well less than his target payout (in the range of 46% below a full payout to 85% below a full payout)," the company said in its proxy statement. The three core financial metrics used to measure company performance are revenue, earnings per share and cash flow from operations.

These nine tech execs aren't the only ones who netted seven-figure cash bonuses last year. Others include: EMC CEO Joe Tucci ($2.6 million cash bonus); HP CFO Cathie Lesjak, who served as interim CEO during the search for Mark Hurd's successor ($2.6 million); Adobe Systems CEO Shantanu Narayen ($2.2 million); BMC CEO Robert Beauchamp ($2.2 million); NetApp CEO Tom Georgens ($2 million); Juniper CEO Kevin Johnson ($2 million); The CenturyLink CEO Glen Post ($1.9 million); Akamai CEO Paul Sagan ($1.4 million); CA CEO Bill McCracken ($1.3 million); Novell CEO Ron Hovsepian ($1.3 million); Citrix Systems CEO Mark Templeton ($1.2 million); Red Hat CEO Jim Whitehurst ($1.1 million); Riverbed CEO Jerry Kennelly ($1 million)

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