Eric Schmidt's $100 million 'farewell'

By David Goldman, staff writer


NEW YORK (CNNMoney) -- After receiving just $1 a year in salary since 2004, outgoing Google CEO Eric Schmidt is getting a nice, fat $100 million 'thank you and farewell' present.

Well, not so fast.

Schmidt's award, approved by Google's board on Friday and disclosed Monday in a regulatory filing, is a stock-and-options package with a four-year vesting period. That means that he's got to stick around at the company until at least 2015 to fully cash it out.

Schmidt's move from the CEO spot to a position as "executive chairman" of Google's board set the tech industry twittering about whether the change was the first step toward a departure from the company.

The new $100 million package marks the first stock-based compensation that Schmidt has received since he took over as Google's CEO in 2001. His initial salary was $250,000 a year, but in 2004 Schmidt requested that it be cut to $1, where it has remained ever since.

Of course, it's not like he needs the money. When he came on as CEO, Schmidt received a boatload of stock awards, giving him an ownership stake in Google worth about 3% of the company as of the end of 2010. His 9.2 million Google shares make him worth $5.8 billion.

Schmidt last sold Google shares in 2007, but he recently announced that he plans on selling 534,000 shares, taking his ownership of Google down to 2.7%. At Monday's prices, Schmidt would make $325 million from the deal.

Google surprised the tech community on Thursday when it said Schmidt would hand over day-to-day operations of the company to Google's founding CEO Larry Page. Schmidt will stay on as executive chairman after he leaves his CEO role on April 4.

According to the company, he will focus on deals, partnerships, customers and broader business relationships, government outreach and technology thought leadership. He will also continue to act as an advisor to co-founders Page and co-founder Sergey Brin. To top of page

Frontline troops push for solar energy
The U.S. Marines are testing renewable energy technologies like solar to reduce costs and casualties associated with fossil fuels. Play
25 Best Places to find rich singles
Looking for Mr. or Ms. Moneybags? Hunt down the perfect mate in these wealthy cities, which are brimming with unattached professionals. More
Fun festivals: Twins to mustard to pirates!
You'll see double in Twinsburg, Ohio, and Ketchup lovers should beware in Middleton, WI. Here's some of the best and strangest town festivals. Play
Index Last Change % Change
Dow 17,042.90 -28.32 -0.17%
Nasdaq 4,493.39 -12.46 -0.28%
S&P 500 1,972.29 -5.51 -0.28%
Treasuries 2.51 0.02 0.68%
Data as of 1:33am ET
Company Price Change % Change
Ford Motor Co 14.79 -0.32 -2.12%
Bank of America Corp... 17.05 0.04 0.24%
eBay Inc 56.63 3.97 7.54%
Apple Inc 100.75 0.64 0.64%
General Electric Co 25.62 0.20 0.79%
Data as of Sep 30

Sections

CNNMoney's Italian-American investing correspondents did a taste test of Olive Garden's food. They agree with hedge fund Starboard: It's not very appetizing. More

Even limited air operations could cost up to $4 billion a year, says a think tank, while large ground forces could cost $1.8 billion a month. More

Pro-democracy protesters in Hong Kong are using FireChat to improve communication and organize. More

On Wednesday, 17% of First Green Bank's 66 employees will get a raise under the company's new "living wage" program. The guarantee: At least about $30,000 a year. More

This mom of four only makes $29,000 a year and is losing $400 a month because the state is garnishing her paycheck over a debt. Now she is about to be evicted from her apartment. More

Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.