Even after Stanley Black & Decker shareholders rejected the tool and security company's executive pay plan last spring, the company paid Nolan D. Archibald, its executive chairman and the former CEO of Black & Decker, a total of $64.4 million in 2011.
Archibald became chairman in March 2010 when the former Towson-based Black & Decker Corp. was bought by the Stanley Works in a $4.5 billion deal. At the time, Archibald's sale-related compensation, including bonuses tied to cost-cutting targets, drew criticism from corporate governance experts, who had estimated its worth at $89 million over three years.
Black & Decker's former Power Tools division, which had accounted for three-quarters of the company's revenue, remains based in Towson.
John F. Lundgren, CEO of Stanley Black & Decker, who led Stanley in the Black & Decker acquisition, received total compensation of $19.8 million last year.
Stanley's executive compensation was disclosed in its annual proxy filing with federal regulators, which also invited shareholders to its 2012 annual meeting on April 17 in New Britain, Conn.
Archibald, 68, who headed the century-old Black & Decker for 24 years, one of the longest-serving CEOs of a Fortune 500 company, was paid $1.5 million last year in base and a $1,875,000 cash bonus.
He received "other compensation" totaling $627,900, including financial planning services, life and disability insurance, a car allowance, home security system, club dues, tickets to sports and entertainment events, personal use of the company's aircraft, and up to $5,000 of company products. The company also paid all his taxes on those perks.
Archibald also realized $9.6 million exercising stock options, $4.8 million from newly vested company stock and $44.1 million in pension payouts. In addition to those packages, this year, Archibald was granted stock and the right to buy discounted shares in the future that could be worth $8.3 million, if performance goals are met, and based on end-of-year stock prices.
The executive pay vote by shareholders at the 2011 annual meeting was not binding, but made Stanley one of a small handful of companies whose shareholders voted against executive pay given in 2010.
Stanley said when it asked shareholders why they disapproved of the pay, they cited the merger-related compensation, particularly "restricted stock unit grants for certain executives" and Archibald's package, which will include a $45 million payout in 2013.
Yet Stanley made only minor changes to its compensation, the company said in the proxy.
"We continue to believe our core compensation programs closely align pay and performance," the company said in the proxy's discussion of executive compensation.
The company noted that shareholders who owned Black & Decker stock at the time of the merger have seen its price rise 89 percent and shareholders of the Stanley Works have seen a 56 percent gain. The S&P 500 increased 22 percent over the same period, the company said.
"Shareholders are much more likely to forgive high pay levels if they see their investment growing," said Paul Hodgson, senior research associate at GMI Ratings, a corporate governance research firm. He predicts that Stanley shareholders will not repeat the negative vote in "Say on Pay" this year.
As Black & Decker's CEO, Archibald was one of Baltimore's most highly compensated executives in 2010 with a total pay package of $28.2 million. Shortly after the sale was announced in 2009, Archibald agreed to forgo $20.5 million in severance that would have been due to him for losing his job in the case of a merger.
Stanley said it could not have changed Archibald's package after last year's shareholder vote.
"The negotiation of and contract entered into regarding Mr. Archibald's compensation was an integral part of the negotiation of the Merger Agreement," the proxy stated. "The Merger and the associated arrangements constitute an extraordinary event that is not indicative of the Company's ongoing compensation practices."
Baltimore Sun reporter Lorraine Mirabella contributed to this article.