IBM fashions options plan for managers
Article Abstract:
New IBM Chmn Louis V. Gerstner Jr. is taking a highly unusual approach to securing the morale of top managers. Gerstner faces the delicate task of keeping managers from leaving IBM while at the same time avoiding shareholder anger over executive compensation. Gerstner is offering 1,200 managers the option to swap 2.5 old stock options, which are largely worthless, for new ones exercisable at $47.88 per share. Managers will not be able to exercise their options unless IBM stock rises 50 percent above the $47.88 price and stays there for 30 straight days. They must also stay with the company two years to exercise half their options and two more years to exercise the remainder of their options. IBM's stock is currently trading in the high $40s, down more than 50 percent since early 1992. Gerstner's offer does not apply to IBM's top 24 executives.
Publication Name: The Wall Street Journal Western Edition
Subject: Business, general
ISSN: 0193-2241
Year: 1993
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IBM's Gerstner received a 26% raise in 1997 salary and bonus to $6 million
Article Abstract:
IBM Chmn Louis V. Gerstner Jr.'s 1997 salary and bonus rose 26% to $6 million from $4.8 million while the company's market capitalization increased by $23 billion. Gerstner also has received a 10-year consulting contract starting in 2002, according to an IBM proxy. Terms of the arrangement, IBM said, allow Gerstner to join any noncompeting company after 2002 and will compensate Gerstner only for the days he actually works. The daily fee would equal his latest daily salary, and IBM would pay for expenses as well as use of its facilities, cars and corporate jets. Gerstner in 1997 signed a five-year contract extension through Mar 2002. The future agreement is unusual in that Gerstner must work for the money, according to compensation consultant Johnson Associates.
Publication Name: The Wall Street Journal Western Edition
Subject: Business, general
ISSN: 0193-2241
Year: 1998
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