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Tyco Electronics CEO Gets $2.6M Pay In 2008

The Associated Press

SAN FRANCISCO (AP) — The pay package for Tyco Electronics Ltd. Chief Executive Thomas Lynch was about a quarter the size in the company's fiscal 2008 that it was in 2007, coming in at $2.6 million for the first full year of the company's operation as a standalone entity, according to calculations by The Associated Press based on the company's proxy filing Friday.

Lynch, 54, wasn't dinged for his performance. His base salary rose 7 percent to $950,000 in 2008 and his performance-based cash bonus jumped 70 percent to $1.4 million, according to Tyco Electronics' filing with the Securities and Exchange Commission. He also received $185,097 in perks, including a $95,000 cash allowance that amounted to 10 percent of his salary.

The key difference between Lynch's pay in 2008 and 2007 was that he and other executives got big, one-time equity awards when the electronics division was spun off from Tyco International in 2007. The Bermuda-based company said the payments were to "establish a meaningful ownership stake in the newly separated company."

Lynch's 2007 compensation package was valued at $11.0 million by the AP's calculations, including an equity award worth $9 million. The company didn't issue any new equity awards in 2008, and aside from the equity award, his compensation package was bigger in 2008 than 2007.

The company's 2008 fiscal year, which ended in September as the financial crisis started deepening, was solid financially: Sales rose 14 percent to $14.8 billion, and the company posted a $1.78 billion profit. Since then, the company has racked up more than $3 billion in losses as it absorbed huge write-downs to account for sales declines in its electronics components and specialty products.

The AP formula is designed to isolate the value a company's board placed on an executive's total compensation package during the last fiscal year. It includes salary, bonus, performance-related bonuses, perks, above-market returns on deferred compensation and the estimated value of stock options and awards granted during the year.

The calculations don't include changes in the present value of pension benefits, and they sometimes differ from the totals companies list in the summary compensation table of proxy statements filed with the Securities and Exchange Commission. Those totals instead reflect the size of the accounting charge taken for an executive's compensation in the previous fiscal year.

The company's annual meeting is scheduled for June 22 in Bermuda.