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Intel CEO Nets Big Bucks From Options

Craig Barrett raked in $17.6 million from exercising options in 2002, according to a regulatory filing
WASHINGTON (AP) -- Intel Corp.'s chief executive made $17.6 million from exercising options last year, according to a regulatory filing Wednesday.

Craig Barrett, CEO of the semiconductor giant, was paid a salary of $610,000 in 2002--a raise of $35,000 from 2001--while his bonus remained at $1.1 million, the proxy said.

In addition, Intel granted Barrett options to purchase 584,000 common shares at an exercise price of $29.33. Assuming a 10 percent annual increase in Intel's stock price, the shares are valued at about $27 million. The options become exercisable in April 2004 and expire in 2012. As of Dec. 31, Barrett held exercisable options to purchase 2.2 million Intel shares.

Intel paid its chairman, Andrew Grove, a salary of $431,000, down from $525,000 the year before, and a bonus of $755,500, also lower from $981,800 in 2001, as stated in the filing.

Grove was awarded a stock-option grant to purchase 664,000 shares at an exercise price of $29.33 a share and exercisable in April 2004. Assuming a 10 percent annual increase in Intel's stock price, the grant is worth $31 million, according to the filing.

Grove didn't exercise any options in 2002.

Separately, the United Brotherhood of Carpenters and Joiners of America Pension Fund, which owns about 31,150 Intel shares, has proposed the semiconductor giant begin expensing the costs of stock options. The pension fund said expensing stock options would more accurately reflect Intel's operational earnings.

Intel recommends shareholders vote against the proposal.

The company said the cost of an option is accurately and transparently reflected in its income statement. Also, Intel said expensing the options on its income statement would impair the comparability and usefulness of its financial reports.