2004 Top Ten: CEO Payouts

While youre making those belt-tightening New Year’s resolutions, figuring out how you’ll pay for your holiday splurge and ruing the size of your Christmas bonus, perhaps you'd be interested in how some storage CEOs are doing financially.

At least five top executives at pure-play storage companies grabbed seven-figure salary/bonus compensation during the lastest pay periods on record, according to SEC filings -- and that's not counting stock options.

Note that some of the figures below represent 2003 earnings reported in 2004, so in 2005 we may see even bigger figures. Following, in descending order from least to most astonishing, is our take on who got top earnings reports this year -- sometimes in spite of their companies' performance:

No. 10: Joe Tucci, EMC

The EMC Corp. (NYSE: EMC) boss earned $1 million in salary, and a $1.71 million bonus for 2003, which was reported in 2004. That bonus, by the way, was less than the bonsues paid to CEOs of Storage Technology Corp. (StorageTek) (NYSE: STK) and Veritas Software Corp. (Nasdaq: VRTS) -- more on those in a minute -- although Tucci at least matched their $1 million base salary (see Tucci's Touch of Gold). No. 9: Greg Reyes, Brocade

Reyes received an early Christmas present this month when the Brocade Communications Systems Inc. (Nasdaq: BRCD) compensation committee handed him a $344,825 bonus on top of his $500,000 2004 salary. Brocade had the best year among SAN switch players, so Reyes no doubt earned every dime of his bonus (see SAN Switch Year-End Summary and Brocade Tops Switch Sales). Then again, the 110 or so employees Brocade laid off this year might disagree (see Brocade Hits Estimates, Lays Off 110 and Brocade Denies More Cuts).

No. 8: John Kelley, McData

The McData Corp. (Nasdaq: MCDTA) Big Mac received $400,000 in base salary and a $125,000 bonus based on McData’s 2003 performance. This year, Kelley is eligible to get a bonus equal to up to 125 percent of his salary. Consider the year McData has had, he’ll be lucky to match last year’s bonus.

No. 7: H.K. Desai, Qlogic The QLogic Corp. (Nasdaq: QLGC) CEO’s 2004 bonus of $615,000 came to more than his $576,000 salary. And both figures were higher than corresponding numbers for Paul Folino, his counterpart at Emulex Corp. (NYSE: ELX), Qlogic's chief competitor. Folino got a salary of $538,000 and a $361,000 bonus for fiscal 2004. Next year, he'll get more: In September, the Emulex board gave Folino a base salary raise to $557,000 with a bonus target of $501,000.

No. 6 Richard Reese, Iron Mountain

The Iron Mountain Inc. (NYSE: IRM) board apparently likes the job Reese is doing. It awarded him a $1.17 million performance bonus for 2003 on top of his $770,000 salary. That was before the company continued to grow its storage and services revenue and picked up archiving company Connected for $117 million (see Iron Mountain Gets Connected). We can't wait for the next report!

No. 5 Peter Van Oppen, ADIC

Van Oppen of Advanced Digital Information Corp.’s (Nasdaq: ADIC) received $340,000 in salary and a $240,000 bonus in 2003. The board must’ve been happy: No ADIC executives received performance bonuses in the two previous years. Things haven't gone as well for ADIC this year, however, so we'll see if history repeats (see ADIC Sales Down Despite EMC). No. 4 Gary Bloom, Veritas

On top of his $1 million salary, the Veritas CEO earned a $1.85 million bonus based on hitting EPS and revenue growth targets in 2003. But accounting goofs may scoop away some of the glory (see Veritas Revises Balance Sheet). And once the Symantec merger goes through, Bloom won't be a CEO at all, but president under Symantec CEO John Thompson (see Symantec & Veritas: It's a Deal).

No. 3 James Lambert, Dot Hill Systems

The head of Tier 2 SAN vendor Dot Hill Systems Corp. (Nasdaq: HILL) received a $1.27 million performance bonus in 2003, which isn’t all that much less than Tucci got from EMC. The Dot Hill board also raised Lambert’s salary from $350,000 in 2003 to $385,000 in 2004.

No. 2 Pat Martin, StorageTekStorageTek’s CEO received a whopping $5.3 million bonus in 2003, including $2 million for extending his contract by two years -- through June 2006. The rest was for performance. And you thought tape library vendors were struggling!

No. 1 Thomas Hudson, CNT

The Computer Network Technology Corp. (CNT) (Nasdaq: CMNT) board was so happy with Hudson after CNT purchased Inrange in 2003 that it bumped his salary from $367,000 to $500,000 and gave him a $400,000 bonus for successfully integrating the switch company into CNT. So far, the results of the acquisition have been disastrous: CNT hemorrhaged money and employees this year while struggling for survival (see CNT Takes a Hit).

So there's our list of storage networking's fat cats. On the other side of the coin, we think Network Appliance Inc. (Nasdaq: NTAP) CEO Dan Warmenhoven should renegotiate. Warmenhoven earned a relatively paltry $210,000 incentive bonus on top of his $440,000 2004 salary during a stellar year for NetApp.

— The Editors, Byte and Switch0