CEO pay watch: Fastenal's Daniel Florness made nearly $5 million in 2016

President, CEO

Total compensation: $4,976,398 for the year ended Dec. 31

Salary: $577,500

Nonequity incentive pay: $32,713

Other compensation: $2,733

Exercised stock options: $4,363,452

New stock options: 130,434

Total 2016 shareholder return: 18.5 percent

Note: Fastenal executives generally didn't receive base salary increases last year. Florness was promoted to president and CEO in Oct. 25, 2015, though, so he saw a 34 percent increase over his 2015 salary. His base salary rate was the same as Fastenal's previous president and CEO.

Financial bonuses for Fastenal executives are calculated quarterly. The performance bonus is measured either on pretax net earnings or net earnings. In 2016, the company failed to meet the minimum target levels in the first three quarters of the year. As a result, Florness earned a bonus of $32,713, more than $300,000 less than the bonus he earned in 2015.

In the company's proxy statement, the company said its compensation philosophy is to keep the incentive program "simple, understandable and transparent." To that end, financial bonus payments are based on only one measure.

Patrick Kennedy