Instead, the honor went to Jeffrey Weitzen, who joined Gateway as president and chief operating officer in January 1998.
Through the magic of signing bonuses, moving expenses, and restricted stock awards, Weitzen's compensation came to nearly $3.5 million in salary and other consideration, according to a preliminary proxy statement filed with Securities and Exchange Commission. Weitzen also received 1,000,000 stock options at a strike price of $34. Were they cashed today, the options would net him $34.5 million.
Waitt, by contrast, took home $1.8 million in salary and bonuses and 160,000 stock options. He also received $281 in imputed income for group life insurance.
Nonetheless, Waitt remains the company's largest shareholder, with 64.4 million shares in the direct PC maker, according to the proxy.
Whether or not Weitzen is to be credited for helping turn the company around, he certainly came to Gateway at the right time.
Last January, Gateway had just recovered from financial losses in the third quarter of 1997. The stock traded in the $37 to $38 range. The company was continuing to gain market share, but margins were declining.
A former executive vice president of AT&T's business markets division, Weitzen took over responsibilities for directing the company's sales and marketing divisions, manufacturing, engineering, and worldwide business operations.
Since his arrival, Gateway has been a leader among PC makers in devising new methods of generating new revenue opportunities out of its existing customer base. In the past year, Gateway has opened a number of new Country Store locations, which effectively give the direct marketer a retail presence.
In addition, Gateway launched its YourWare program, which allows it to sell additional hardware, software, and ISP services to customers. YourWare has been instrumental in Gateway's continued growth, according to a number of analysts.
Accordingly, the stock closed today at $68.50, nearly double its price from a year ago.
Weitzen surpassed Waitt in compensation largely because of his signing bonus and other compensation above and beyond his salary and performance bonus. The executive received a $1.4 million signing bonus for coming to the company, along with a fully vested restricted stock award worth $600,000 and other compensation--including such items as disability insurance premiums and use of the company airplane--worth $144,983.
In terms of salary and bonuses, he made less than Waitt. The latter received $1,000,000 in salary, a 62 percent increase over his salary of $615,000 in 1997, and an $800,000 bonus, more than triple his bonus of $239,000 for the previous year.
By contrast, Weitzen received a salary of $707,692 and a bonus of $600,000 for the year. All together, his compensation comes to just under $2.4 million not including the stock options. The 1,000,000 stock options vest over a four-year period.