Paycom founder Chad Richison has become the highest-paid CEO in the S&P 500 after he was awarded a 2020 compensation package worth $211 million, it has been revealed.
Richison, who founded the payroll processor in 1998, was awarded 1.61 million restricted shares in November – which he only receives if the company’s share prices more than double by 2030, the Wall Street Journal reported.
Richison, 50, has become the highest paid CEO in the S&P 500, according to data from research company MyLogIQ.
His award of restricted shares could eventually add more than $2 billion to his fortune in the next 10 years and is estimated to be worth a number closer to $702 million, according to a calculation by ISS ESG, the Wall Street Journal reported.
The compensation package is one of the five largest awards to a CEO since at least 2010, MyLogIQ data shows – according to the Wall Street Journal.
Paycom founder Chad Richison has become the highest-paid CEO in the S&P 500 after he was awarded a 2020 compensation package worth $211 million. He is pictured right with his wife Charis
Richison only gets the restricted shares for ‘achieving aggressive performance goals’
The compensation package is one of the five largest awards to a CEO since at least 2010, MyLogIQ data shows
Elon Musk received the largest CEO award in 2018 when he was given stocks valued at $2.3 billion by his company Tesla.
Tim Cook of Apple received the second largest award worth $378 million in 2011 and Alphabet Inc.’s Sundar Pichai received a package worth $280.6 million from Google’s parent company in 2019.
Jason Clark, chairman of the Paycom board’s compensation committee, told the WSJ that the award depends on Richison ‘achieving aggressive performance goals.’
‘Mr. Richison’s recent performance equity award is structured to align with stockholders’ interests, as it requires significant value creation for them before he can realize any value from the grant,’ Clark said.
‘This award is entirely dependent on Mr. Richison achieving aggressive performance goals—which will generate tremendous value for our stockholders.’
Richison only gets half of the shares if the company’s stock price stays above $1,000 for 20 consecutive trading days within six years, the outlet reported. He gets the other half if the share price reaches $1,750 for 20 straight days by late 2030.
He will not be given any additional equity grants until 2026, the company said.
Paycom’s share prices closed at about $378 on Monday, the WSJ reported.
The company went public in 2014 and its share prices have surged over the past year and has outperformed the S&P 500. Paycom’s stock prices have are up 108.72% in the past year while the S&P 500 is up 53% in the last year.
‘Paycom’s market value has jumped from $2 billion five years ago to $22.7 billion based on Monday’s closing stock price,’ the Wall Street Journal reported.
According to Forbes data, Richison has a net worth around $2.9 billion making him the 1,064 on a list of the world’s billionaires. He has given away between 1% to 4.99% of his wealth, the outlet reported.
Richison, of Tuttle, Oklahoma, has a rating of 9/10 on Forbes’ self-made score – which makes him a ‘true rags-to-riches’ story, according to the outlet.
‘Growing up in Tuttle, Oklahoma, I learned that if I wanted something, I had to work hard for it. That upbringing gave me a do-for-yourself-and-others spirit, and I am very grateful for that,’ Richison wrote while signing The Giving Pledge.
‘In high school, I started my first business hauling hay. As a young entrepreneur, I learned early on that you have to work hard, honor your commitments and surround yourself with good people because no one does it alone.’
