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Wednesday, September 6, 2006 - Page updated at 12:00 AM

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Boeing stock incentives have paid off for Mulally

Seattle Times business reporter

The long climb of Boeing stock to record levels has been very good for Alan Mulally.

So far this year, Mulally has received $11.7 million in bonuses tied to Boeing's stock price, according to his filings with the Securities and Exchange Commission. Those payments come on top of $7.6 million in stock-incentive bonuses he received last year and $2.9 million in 2004.

Like other top Boeing executives, Mulally has earned the great bulk of his compensation the past few years from several sets of incentives, which pay off in Boeing stock if the shares reach designated target prices over a period of years.

Even after he leaves to run Ford, Mulally will reap benefits from the incentive plans if Boeing's shares resume their climb. (They've declined 15.2 percent since peaking on May 10.)

He will also be entitled to an annual pension equal to his base salary, which last year was $825,000. Mulally's 37 years with Boeing and pay level normally would entitle him to a bigger pension — about $1 million a year — but the company caps its executive retirement payments at 100 percent of base pay.

Mulally will keep the 79,841 Boeing shares he owned directly and indirectly as of May 12, the date of his last filing with the SEC, and options on 220,600 more Boeing shares.

He will, however, forfeit 26,749 "career shares," which only pay out if an executives stays with Boeing until retirement; the 6,594 "stock units" he was awarded last year, which vest after three years; and the 66,000 options he was granted in February, which vest over a three-year period.

Drew DeSilver: 206-464-3145 or ddesilver@seattletimes.com

Copyright © 2006 The Seattle Times Company

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