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Overall, UnitedHealth shares climbed 7 percent to close 2012 at $54.24, a smaller gain than the 13.4 percent advance from the Standard & Poor's 500 index. The Associated Press formula calculates an executive's total compensation during the last fiscal year by adding salary, bonuses, perks, and the estimated value of stock and stock options awarded during the year. The AP formula does not count changes in the present value of pension benefits. That makes the AP total slightly different in some cases from the total reported by companies to the Securities and Exchange Commission. The value that a company assigned to an executive's stock and option awards for 2012 was the present value of what the company expected the awards to be worth to the executive over time. Companies use one of several formulas to calculate that value. However, the number is just an estimate, and what an executive ultimately receives will depend on the performance of the company's stock in the years after the awards are granted. Most stock compensation programs require an executive to wait a specified amount of time to receive shares or exercise options. Outside AP's calculation of his 2012 total compensation, Hemsley also acquired 284,836 shares that had vested with a value of $15.3 million. He also exercised options to acquire 600,000 shares and realized a value of $12.5 million. Those options and stock awards had been previously given to the executive. The proxy said Hemsley directly owned UnitedHealth shares valued at about $140 million, as of March 1.
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