Intel Won't Give Up the Options Habit

When it comes to corporate pay, options are clearly where the money is. In 2002, Intel (INTC Quote) CEO Craig Barrett cashed in $17.57 million worth of options, a sum far outstripping his regular paycheck, and received a hefty grant of more than a half-million new options.

Indeed, payouts of this magnitude are exactly why one shareowner of the stock is pushing a proposal to make Intel expense options. In its latest proxy filing to the Securities and Exchange Commission outlining executive compensation, Intel said shareholders will vote on the measure at its annual meeting on May 21.

In line with its long-term stance against expensing options, Intel's board opposes the latest measure.

In other pay news, Barrett received a relatively humble salary of $610,000, reflecting a $35,000 raise from the prior year, and a bonus of $1.07 million, about even with last year.

In an SEC filing, Intel explains that it's company practice to pay executives below-average salaries but offer them the potential to take home big bonuses if business groups beat certain targets. It says Barrett's base salary and bonus was only 58% of the average compensation at peer companies.

By the most basic yardstick of performance for investors -- stock price -- Intel's performance last year was less than enthralling. In 2002, the company's stock price sank 51%, underperforming the S&P 500 by 27.1%.