NVR, which has weathered the housing recession better than almost every other production builder, awarded its CEO Paul Saville total compensation for 2010 of close to $31 million.
The bulk of that compensation came in the form of equity that NVR’s compensation committee had granted the builder’s top executives in May 2010. While Saville’s salary last year was $800,000—where it’s been frozen, at his request, for the past four years—he was also granted 57,344 options and 21,046 restricted share units. The option and stock awards were valued at $14,795,325 and $14,795,338, respectively.
The company also reported that Saville exercised 49,000 options last year, reaping $21,712,016.
In its Schedule 14(a) filing with the U.S. Securities and Exchange Commission, the Reston, Va.–based NVR explains that the options and stock awards calculations represent gains that Saville could realize in the future. He also received $481,299 in compensation in the form of non-equity incentives, and $7,850 in other compensation.
Its filing reveals, however, that Saville and NVR’s other top officers were in line for even higher compensation had the company achieved performance targets upon which it bases its annual bonuses. Those execs would have earned 100% of their annual bonuses if NVR’s consolidated pretax income in fiscal 2010 had reached $427.8 million. Its actual pretax income, though, was $403.5 million, which NVR states translated into 71.6% of this portion being attained.
The filing goes on to say that NVR’s 9,415 new orders in fiscal 2010 fell short of its goal of 10,800 units. Consequently, Saville, along with NVR’s CFO Dennis Semeret and Principal Accounting Officer Robert Henley, earned 60.2% of their maximum bonuses.
John Caulfield is senior editor for Builder magazine.
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