HP bigwigs get hefty pay packets

LOS ANGELES: Carly Fiorina, chief executive of Hewlett-Packard Co, got a pay package worth more than $10 million last year, while lieutenant Michael Capellas received more than $26 million after resigning.

Fiorina, the main engineer of the acquisition of Compaq Computer Corp., earned a $1 million salary in 2002 and received a bonus of $2.9 million, a raise after receiving no bonus in 2001, voting materials sent to shareholders ahead of the April 2 annual meeting showed. Fiorina also took home stock options valued at $6.8 million in 2002, although at HP's current stock price they could not be exercised profitably.

The HP board also raised the maximum bonus Fiorina could receive to $12 million from $9 million annually, citing her increased responsibilities.

Fiorina's compensation became a subject of controversy last year when former director Walter Hewlett said the board was considering raising Fiorina's salary to $70 million over two years upon the completion of the controversial merger.

Fiorina put together the merger with the help of Capellas, former Chief Executive of Compaq, and both declined retention bonuses during the deal. Capellas' Compaq contract assured him compensation if he left the company after losing his title of CEO.

Capellas left HP last year and took over as Chief Executive and Chairman of bankrupt telecom company WorldCom Inc., where he will be paid as much as $5 million in salary and bonuses and $18 million in restricted stock.

Capellas' package for HP last year included $800,000 in salary, $1.9 million in performance bonus and a separation payment of $14.4 million. HP gave him $9.6 million more to cover taxes.

© Reuters