September 22, 2004 4:33 PM PDT
Pay for Sun's Schwartz jumps 56 percent
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In April, Schwartz was promoted from head of the software business to the No. 2 executive at the Santa Clara, Calif.-based server and software company. His boss, Chief Executive Scott McNealy, was paid $100,000 in both fiscal 2003 and 2004, according to a Wednesday filing with the U.S. Securities and Exchange Commission.
For fiscal 2004, which ended June 30, Schwartz's salary of about $559,000 was supplemented by a $108,000 bonus, $6,000 for other compensation and $3,500 for patent applications. In addition, he was awarded 1.5 million stock options that could be worth $9,284,000 if Sun's share price rises 5 percent per year.
McNealy was also awarded 1.5 million stock options, which could be worth $9,204,000 under the same assumptions.
The company was punished by three straight years of revenue declines when spending for its equipment plunged this decade because of the recession, the demise of Internet mania and new competition from IBM, Dell and Linux. But in its most recent quarter, Sun returned to growth.
However, to try to return to profitability, Sun is taking drastic measures, including a 3,300-person layoff currently under way, the third major job cut in as many years.
At its most recent quarterly product launch event, Schwartz said the company hopes to return to prosperity through improvements to its Solaris operating system; the embracement of new chips, including Advanced Micro Devices' Opteron, Sun's Niagara and Rock, and Fujitsu's Olympus processors; a detente with Microsoft; an attack on Linux seller Red Hat; and subscription pricing that bundles hardware, software and services.