Micron's losses and layoffs haven't stopped the company from awarding millions of dollars in stock to top executives.
CEO Steve Appleton has just received 680,143 shares, according to a company filing Thursday with federal securities regulators. The stock is worth almost $7.2 million at Thursday's closing price of $10.56 a share.
The grant brings Appleton's holdings to nearly 1.8 million shares, worth $18.8 million.
Appleton isn't the only beneficiary of the board's generosity. Micron's No. 2 man, Mark Durcan, president and chief operating officer, received 312,501 shares, worth $3.3 million. He now holds 638,698 shares worth $7.2 million. Eight other executives and several directors received grants, according to filings with the Securities and Exchange Commission.
The latest round of stock options comes a little more than a week after the company reported $158 million in fourth-quarter losses and just months after the Boise company shed more than 1,100 workers at its Treasure Valley operations. The company said it needed to cut operating costs to better compete with foreign competition. It has hinted that more cuts may be on the way.
It's not known when the board decided on its awards, which were granted Monday and Tuesday. The board says it bases incentive amounts on several factors, including Appleton and the company's performance.
The stock Appleton, Durcan and others received Tuesday is restricted, meaning it can be sold only after a predetermined period. Appleton's previous grants have become eligible for sale over three years in three equal installments.
Micron executives started receiving restricted stock in 2004, when the board revised its equity incentive plan and authorized restricted stock rather than stock options.
Appleton was awarded 70,000 shares in the first year, 310,000 shares in 2005 and 424,100 in 2006.
During the same period, the company's stock price has dropped nearly 39 percent, from $14.19 at the end of fiscal year 2002. Micron's stock price is still well below 2001 levels of nearly $37 a share.
Compensation experts say more companies have turned to restricted stock to keep executives with a company during tough times.
Tech companies used to give stock options, which allow holders to buy stock at set prices, usually below the stock's market price, and then sell it at market price. But falling prices for tech stocks made the options worthless for many employees.
By comparison, restricted stock never will be worthless the way regular stock options can be. Even if the stock price falls, restricted stock retains some of its intrinsic value.
In 2006, Hewlett-Packard's board awarded CEO Mark Hurd 150,000 shares of restricted stock worth $4.7 million at the time.
At last count, Appleton also had more than 2.7 million stock options that he hasn't exercised.
The exercise prices of some of those options are now higher than what the company's stock trades for.
Other companies sometimes award stock to corporate leaders despite losses, too. Former Albertons CEO Larry Johnston sold the Boise-based grocery retailer last year and walked away with a restricted stock package valued at more than $38 million despite his inability to boost sales.
Micron stock fell 15 cents from Wednesday's $10.71 close.
Ken Dey: 672-6757
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