New Sun chief gets golden parachute

New Sun chief Jonathan Schwartz will also have access to a private jet

Newly appointed Sun Microsystems chief executive Jonathan Schwartz will receive a base salary of $1m and a performance related bonus of up to $2m, according to a filing with the Securities and Exchange Commission. 

The server maker's former chief operating officer will also receive an option to purchase two million shares of common Sun stock at a price equal to the fair market value on the date they are granted. The package will vest at a rate of 20 per cent.

Schwartz is also entitled to 800,000 restricted stock units that will vest based on certain performance criteria, and can look forward to another 1.5 million restricted stock units if he makes his one year anniversary as chief executive.

Based on Thursday's closing stock price, the combined packages are valued at $11.4m.

Even if Schwartz does not make his first year, there is no reason to despair. He is entitled to three times his annual pay if he loses his job.

As one of the more notable perks, Sun also promised to "provide Mr Schwartz with private jet access for business and reasonable personal use" and will cover "reasonable expenses" to provide personal security.

Schwartz was appointed on Monday as the new chief executive at Sun, replacing Scott McNealy who will continue to work as chairman.

McNealy will retain his existing pay package including bonuses until 1 July when he will receive a $1m base salary and a $1.5m annual bonus. His stock compensation is set at options for $2.1m and 350,000 restricted stock units.

McNealy also gets access to the private jet service, but only for business use.