Expedia CEO's Pay Makes Him First Among SP 500 CEOs. Google CEO Second

IPOs were one thing, but overtaking the rest of corporate America in terms of executive compensation demonstrates tech's long term economic dominance. This interweb thingy might have legs...JL


Drew FitGerald and Theo Francis report in the Wall Street Journal:

Expedia Inc. Chief Executive Dara Khosrowshahi’s total compensation ballooned to $94.6 million last year. The 46-year-old’s pay package places him at the top of S&P 500 CEOs so far this proxy season. Among the biggest U.S. companies, his compensation trails only Sundar Pichai, who received $100.5 million to run Alphabet Inc.’s Google.

Expedia Inc. Chief Executive Dara Khosrowshahi’s total compensation ballooned to $94.6 million last year, making him one of the most highly paid leaders in corporate America.
The vast majority of that sum came from a package of stock options that the online travel company gave him in March and that vests over several years, according to a securities filing submitted late Friday. In 2014, Mr. Khosrowshahi’s compensation totaled $9.6 million.
The 46-year-old’s pay package places him at the top of S&P 500 CEOs so far this proxy season. Among the biggest U.S. companies, his compensation trails only Sundar Pichai, who received $100.5 million mostly in stock to run Alphabet Inc.’s main operating unit, Google.
The Expedia stock option awards come with strings attached. Many would only vest in 2020 if the company’s share price climbs to $170, a high target for shares that closed at $115.77 in New York trading Friday.
The pay package stems from a five-and-a-half-year employment agreement Expedia signed with Mr. Khosrowshahi last year. The company made several big acquisitions in 2015, spending more than $5 billion to add Travelocity, Orbitz and the vacation rental site HomeAway to its portfolio of travel brands.

Expedia spokeswoman Sarah Gavin stressed the long-term nature of the option awards, many of which would only vest years from now. The company doesn’t plan to award its CEO more equity compensation until 2020, she added.
“This really is just an example of pay for performance,” Ms. Gavin said. “We want him to stick around.”
Just $3.75 million of Mr. Khosrowshahi’s 2015 pay was cash. The company estimated the value of the options at $90.8 million at the time of grant. Stock-price fluctuations raise and lower their value.
Expedia has a market value of $16 billion and is controlled by media mogul Barry Diller, who serves as chairman and owns a majority of the voting shares.
The company’s shares climbed 46% last year but have stalled in recent months after a string of reports from Wall Street analysts that questioned consumers’ appetite for travel. The stock jumped 8% Friday after the company delivered better-than-expected quarterly results.
Mr. Khosrowshahi can also receive all 2.7 million options immediately if he can sell the company. In addition, if Liberty Interactive Corp.—which together with Mr. Diller effectively controls Expedia—pays cash for all of Expedia’s shares, Mr. Khosrowshahi is entitled to all of the options immediately, the document says. Ms. Gavin said the CEO’s employment agreement has previously included such provisions.
Mr. Khosrowshahi can come by many of the options under other circumstances, as well: if he is fired without cause, for example, or if he leaves after Mr. Diller both stops serving as chairman of the company and either reduces his voting stake in the company below 35% or is overtaken by a larger shareholder.