KRISTEN A. LEENEW YORK (AP) ¿ The chairman and chief executive of Wyndham Worldwide Corp., a hotel and timeshare resort company, received compensation valued at about $6.3 million in 2008, according to an Associated Press calculation of data in a regulatory filing. The pay package awarded to Stephen Holmes was a 17 percent decrease from his 2007 compensation, mostly because he declined a performance-based bonus this year. Wyndham said Holmes proposed that the company eliminate his cash bonus "in recognition of the current global economic environment and the associated impact on Wyndham Worldwide and its employees." Like all hotel companies, Wyndham's performance last year suffered from the credit crunch and a sharp drop in business and leisure travel spending. For 2008, Wyndham reported losses of $1.07 billion, or $6.05 per share, compared with a profit of $403 million, or $2.20 per share, a year earlier. The results included hefty charges to reduce the value of goodwill for the Parsippany, N.J.-based company's vacation ownership business. In December, Wyndham announced it would eliminate 4,000 jobs in its timeshare business and scale back development plans due to the tighter credit market.
According to the Securities and Exchange Commission filing, Holmes received roughly $1.1 million in salary last year, about 6 percent more than his 2007 base pay. The company said it has decided to forgo a planned 2009 salary increase for executives. The company didn't specify the amount of the performance-based bonus that Holmes would have received had he not turned it down. For 2007, he was granted $2.2 million. He was awarded stock and option awards that were valued by the company at $5 million when they were granted in February 2008. However, a large portion of that award has since deteriorated in value with Wyndham's stock price. Wyndham shares lost more than 70 percent in 2008, bottoming at an all-time low of $2.55 in November before regaining some ground to end the year at $4.35. The options have an exercise price of $22.17, while Wyndham shares were trading around $5.61 Thursday afternoon. Holmes' other compensation totaled $222,462 and included $91,695 for his personal use of company aircraft and $23,788 for car expenses. He also received $10,000 for financial planning. The Associated Press' compensation formula is designed to isolate the value the company's board placed on the 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 SEC, which reflect the size of the accounting charge taken for the executive's compensation in the previous fiscal year.
Apart from his 2008 compensation, Holmes realized about $600,000 from vesting stock awards. At the company's annual meeting on May 12, Wyndham shareholders will consider two proposals by other stockholders. If passed, one proposal would urge the board to appoint an independent director as its next chairman. That position is currently held by Holmes. The second proposal, if passed, would urge the board to seek shareholder approval for severance awards for senior executives that are more than 2.99 times the sum of the executives' base salary plus bonus. Wyndham recommended that shareholders vote against both proposals.