Top 3 PC Connection execs raked in $5.6m in 2012
The sharp increase in pay came despite the Merrimack-based computer and software mail order company’s relatively flat year
The top three executives at PC Connection earned a combined $5.6 million in 2012 — an increase of $1.6 million, or 42 percent — according to the company proxy filed with the US Securities and Exchange Commission.
The sharp increase in pay came despite the Merrimack-based computer and software mail order company’s relatively flat year when it came to earnings and sales.
The increases could be related to an executive shuffle at the top. Tim McGrath, who became CEO in August 2011, led the way with $3.3 million, half of that $1.7 million in stock awards. That’s more than the $1.9 million he earned in 2011, when he primarily served as chief operating officer.
McGrath replaced PC Connection co-founder Patricia Gallup as CEO that year, though Gallup, who owns 32.4 percent of the company, retains her position as board chair and chief administrative officer. She was paid $810,000 last year, down from $1.3 million in 2011.
Jack Driscoll, who replaced Jack Ferguson as CFO in March 2012, earned $629,000. When combined with Ferguson’s $930,000 in 2012 (which includes 100,000 shares of stock and $65,000 cash payment in recognition of his prior service), that comes out to $1.56 million for that position. In 2011, PC Connection paid Ferguson $783,000 as CFO.
The five nonexecutive board members were paid a total of $848,661. That doesn’t include Gallup’s salary, but does include $220,400 for co-founder David Hall, who owns 30 percent of the company. Hall works as an analyst for the company, and got $100,000 in “other” compensation, which includes what was described as “standard” fringe benefits.
Gallup and Hall also made money leasing out several commercial properties to PC Connection, according to the proxy. PC Connection paid $1.14 million to G&H Post LLC, an entity solely owned by the founders, for the 114,000-square-foot corporate headquarters in Merrimack, and another $233,187 for an adjacent building. G&H reimbursed PC Connection $99,000 in 2012 for various services performed by the company, such as maintenance and tax services.
PC Connection ended the year with net income of $33.1 million ($1.24 a share), under $5 million more than last year, a tiny margin given the company’s $2.2 billion in sales, which was 2.6 percent above 2011.