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• CEO compensation soars by more than 60 percent
  Compensation for the Carolinas 50 -- CEOs of some of the states' largest public companies -- surged last year as several chiefs cashed in rich stock options worth tens of millions in extra pay.The CEOs received $346 million in total compensation -- a more than 60 percent increase from the prior year. Average CEO pay shot up to nearly $7 million, according to the Observer's analysis.Perks and special stock aside, the group's salary and bonus pay still increased by more than 15 percent over the prior year. That compares to 4.2 percent for Carolinas' workers.Tom Kelly, a compensation expert with human resources firm Watson Wyatt, said strong markets and earnings last year triggered higher bonuses because executives met their targets."Most companies had what they considered strong performances," he said.Each year, the Observer shines a light on CEO compensation in the Carolinas.The tally is a reckoning of salary, bonus, stock awards, perks and profits from exercising stock options -- all listed in filings with the U.S. Securities and Exchange Commission.Under new SEC guidelines, companies are disclosing much more information about executive pay, although that's made it more difficult to make comparisons to previous years.Despite the options windfall, the practice of padding CEO pay with options has been leveling off, the 2006 data show.An option is the right to buy a share of stock at a particular price; it becomes more valuable as the shares increase above that price. Options are increasingly complicated because of new accounting rules and have become controversial due to some highly publicized incidents of cheating, Kelly said.Scores of companies were ensnared in a backdating scandal in which firms cherry-picked low share prices from the past to enrich executives at shareholders' expense."Restricted stock doesn't have all of these issues associated with it ... all these games being played," said Jane Sellers, a Charlotte securities lawyer and partner with McGuireWoods. "There used to be an incentive to choose options, but now that's gone."The Carolinas 50 were awarded more than $95 million in restricted stock -- straight company shares often pegged to CEO performance goals -- up from $57 million in 2005 and $36 million in 2004. That's a two-year, 169 percent increase.Forty company boards chose to make restricted stock awards last year -- up from 25 the year before.Thomas MacMahon, the now-retired chief at Burlington-based Laboratory Corporation of America, received the highest value restricted stock at $12.4 million. Bank of America's Ken Lewis and Wachovia's Ken Thompson were close behind with $11.7 million and $9.1 million, respectively. Duke's Energy Corp.'s Jim Rogers, who is paid only in company stock, received restricted shares valued at $7.9 million.Reflects Carolinas growthThe Carolinas 50 firms represent a wide range of goods and services, from ham and eggs at Denny's restaurants to cardiac surgical services at MedCath Corp.'s speciality hospitals. The top 10 by revenue includes four banks, four utilities and a home improvement chain.Seventeen of the companies call Charlotte home. Only one CEO is a woman.The list reflects an increasing economic status for the Carolinas and for the Charlotte region, which continues to grow from a rush of new residents and solidify itself as the nation's No. 2 banking center.Some other findings in the Observer's examination of CEO pay for 2006:• Highest paid again was BofA's Lewis, whose compensation //increased nearly five-fold to $97 million. Most of the increase was from cashing in $77 million in company stock options accrued over years.The last time Lewis saw his pay fall was in 2005, when his total compensation fell 2 percent to $19.1 million after the stock showed tepid gains. The bank then gave him a slightly smaller bonus and stock grant.• Lowest paid again was Robert Ingle, CEO of Ingles Markets Inc., a 200-unit grocery store chain based in Asheville. His compensation was $101,543 -- a 1 percent increase due to some extra expenses.• Average CEO pay was skewed upward because of several massive stock option paydays for CEOs, including Martin Marietta Materials Inc.'s Stephen Zelnak, who netted $18.1 million cashing in options.• Nineteen of the 50 CEOs sold options for more than $134 million, enough profit to cover the average salary for about 3,500 Carolinas workers.• The estimated value of new stock options issued to the CEOs increased to $58.7 million from $53.25 million the year before -- a 10 percent increase. That includes $6.37 million worth of new options grants for Lowe's chief Robert Niblock, even though his base pay and bonus fell to $1.9 million from $3.4 million the year before.Lowe's ties more than half of CEO compensation -- specifically the bonus -- to company performance. Its income last year fell short of the target. Making it would have earned Niblock an extra $1.9 million.• Nineteen CEOs exercised stock options and collected more than $134 million, up from $58 million the year before. Lewis' $77 million gain was the major factor.• Sealy Corp.'s David Mcilquham made an extra $6.7 million when the company was taken public last year. Most of the money was considered a bonus for agreeing not to immediately sell his shares during the initial public offering.• Susan Ivey, CEO of Reynolds American Inc. and the only woman on the list, received a substantial $3.6 million in restricted stock as part of her package. She ranked 14 in highest pay.The Carolinas 50 tacked a higher percentage onto their pay last year than the nation's CEOs.Average pay increased 9.3 percent, according to a study from The Corporate Library, an independent group that researches executive and board of director compensation. And S&P 500 chiefs with at least two years on the job received an average raise of nearly 24 percent, said Paul Hodgson, a senior research analyst with the library.But with the real estate market stumbling and the mortgage crisis deepening, Kelly said he expects a ripple effect to push earnings down and hit executive bonuses and performance stock hard this year, he said. "There's usually a lag effect."More Carolinas 50 Inside 2D | Full breakdown of CEO pay packages. 3D | The mega-payouts some chiefs could walk away with. Ken LewisBank of America Corp.$96,961,106 Stephen ZelnakMartin Marietta Materials Inc.$23,529,583 Thomas MacMahonLaboratory Corp. of America$19,198,958 Ken ThompsonWachovia Corp.$16,353,320 Marshall LarsenGoodrich Corp.$13,944,161
• To spend or to save?
  More than half of Americans aren't saving enough and many -- especially the younger set -- blame impulse shopping and peer pressure, according to a study released last week by the Consumer Federation of America and Wachovia Corp.The research "reaffirms what Wachovia has already been learning about consumers and savings. Many consumers tell us they aren't saving enough but don't know how to get started. Others tell us they don't want to cut back ... on their current lifestyle," said Kathryn Black, senior vice president and savings director for Charlotte-based Wachovia.Among the findings:• Of the 52 percent of Americans who say they cannot afford to save or are saving inadequately, 35 percent say they are saving but not enough to meet short- and long-term needs and 17 percent say they can't afford to at all.• Economic factors most cited as barriers to savings: 72 percent said large regular expenses, 72 percent said unexpected expenses, 66 percent said low or unreliable incomes and 60 percent said large consumer debts.• Social and psychological factors keeping people from saving: 42 percent cited availability of credit cards, 37 percent cited impulse spending, 29 percent said spending to feel good, 20 percent cited social pressure from friends or family, and 15 percent blamed trips to the mall.• Young adults, ages 18 to 24 years old, are the most likely group to say they aren't saving enough (62 percent compared with 52 percent). Standing in the way of their saving: 54 percent said spending to feel good, 38 percent cited peer and family pressure and 32 percent blamed trips to the mall."This research is unique in that it focuses on attitudes rather than behavior. But attitudes directly affect behavior," said Stephen Brobeck, president of the Consumer Federation of America.The survey was based on 50-plus question interviews of more than 2,000 Americans, conducted by the Opinion Research Corporation last month. The margin of error was plus or minus two percentage points.The survey findings represent the first of several reports to be released before next year's America Saves Week, which starts Feb.