NEW YORK (AP) – The chief executive of Qwest Communications International Inc., Edward Mueller, received compensation in 2008 valued at $11.4 million, according to a regulatory filing Friday.
That was less than the $17.4 million he received for the previous year, when he joined the Denver-based phone company and received a large amount of stock and options as a sign-on bonus.
Mueller's 2008 pay is smaller than, but comparable to, the packages taken home by the heads of AT&T Inc. and Verizon Communications Inc., which are vastly larger and more profitable phone companies.
AT&T CEO Randall Stephenson received $15 million for 2008 after declining a bonus. At Verizon, Ivan Seidenberg received $20.2 million. Verizon's 2008 profit was about nine times the $681 million earned by Qwest; AT&T's profit was 19 times Qwest's.
Mueller's salary was $1.2 million, and he received a bonus of $2.25 million. The bulk of his compensation was in the form of options and restricted stock that were valued at $6.9 million when they were granted last March.
However, the decline of Qwest's stock has diminished the value of those grants. For instance, while the options were valued at $2.7 million when issued, they are now "under water." They give Mueller the right to buy Qwest shares for $5.32 each, while the current stock price is $3.14.
Mueller received nearly $1 million in other compensation, nearly half of which was for personal use of the company aircraft. Mueller's wife and child flew between Denver and their home in California until June 30 last year, before the move to Denver was complete.
The Associated Press calculations of total pay include executives' salary, bonus, incentives, 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 sometimes differ from the totals released by the companies.
Among the shareholder proposals included in Friday's proxy filing is one that would give shareholders a nonbinding "advisory" vote on executive compensation. Verizon instituted such a vote after a similar proposal gained a majority of shareholder votes last year.
Qwest's board recommends voting against the proposal, saying its compensation practices are in the best interest of shareholders, who are already free to communicate with the company.
Shareholders will vote on the proposal at the annual meeting in Denver on May 13.