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Barksdale to make $1 in 1997

Netscape CEO Jim Barksdale is foregoing his salary this year.

2 min read
Preferring to tie his compensation entirely to the long-term performance of his company's stock, Netscape Communications' (NSCP) chief executive will draw a salary of $1 in 1997.

Last year, Jim Barksdale, CEO of Netscape, made $100,000 and no bonus, according to a document the company filed today with the Securities Exchange Commission. That compares with the $562,000 in salary and bonuses that Microsoft chief executive Bill Gates received in the last fiscal year.

This year, Barksdale will give up his salary altogether, bringing home only a symbolic $1 in wages.

Of course, Barksdale, like many of his peers in the high-tech industry, is very handsomely rewarded in stock options in addition to his base salary. As part of his employment agreement with Netscape when he joined in January 1995, Barksdale was given the option to buy 8 million shares of the company's common stock at a cost of just over a nickel per share.

At today's closing price of 26-1/8, that would make Barksdale worth just under $209 million. Barksdale has already excerised options on more than 5.3 million shares, roughly 6 percent of Netscape shares.

Still, his decision to forego any salary at all is a rare one.

"That's incredibly unusual. He does really feel bad about the company's stock," said Igor Sill, managing partner with executive search firm Geneva Group International and expert on high-tech executive compensation. "Disney should do the same thing, or for that matter, so should Apple."

A Netscape spokeswoman said today Barksdale was demonstrating his commitment to Netscape's financial future by forgoing a hefty salary and bonus last year, and by giving up his salary in 1997.

"Jim himself will tell you that he is betting his salary on the company because he believes so strongly in the company," the spokeswoman said

Some observers say the gesture is an impressive one.

"If I were a shareholder, I would like that a great deal," said Sill. "He's putting his focus on increasing the company's overall market value."

Sill contrasted Barksdale's compensation package with that at Apple Computer: "Apple is full of nothing but guarantees. Even if you don?t perform you get phenomenal compensation."

A number of Netscape senior executives drew far higher salaries and bonuses than Barksdale, though they were not rewarded with as many stock options.

Chief information officer Larry Geisel made $318,635 in salary and bonus last year, while senior vice president Richard Schell made $280,844.

The SEC filing did not include the compensation for Netscape's senior vice president of technology Marc Andreessen.