What does every one make of this move by CPQ... Is it bribery to get employees to act responsibily or really mgt.s vote of confidence in the future?
Compaq sets companywide bonus options
By Janet Haney, CBS MarketWatch
Last Update: 6:06 PM ET Nov 23, 1999 Silicon Stocks
Hardware Report
HOUSTON (CBS.MW) -- Compaq Computer will award its 68,000 employees a one-time grant of 200 stock options, which could amount to a total of some 13.6 million shares, CBS.MarketWatch.com has learned.
Chief Executive Michael Capellas, citing the personal-computer giant's string of high-level management changes and financial disappointments, said in a memo to the staff that the award was meant to express that "we feel extremely positive about Compaq's future and your role in that future."
Simon Eastwick, a Compaq spokesman, said part of the plan is to add an incentive for the work force and to get the employees to act like shareholders. He added that the offering is to all full-time, part-time and short-term disability employees as well as those on approved leaves of absence.
Eastwick said Compaq employees currently have the ability to purchase stock through their 401(k) program. The company also offers a management incentive program to employees at certain levels that includes stock options, Eastwick said.
The options plan was announced during a companywide meeting Monday. The strike price -- the price employees would pay for each share, regardless of the stock's price on the dates they choose to exercise the options -- for the bonus options is tied to the stock's Dec. 8 closing price. Compaq, based in Houston, has a total of 1.7 billion shares outstanding.
At Compaq's (CPQ: news, msgs) Tuesday closing price of 24 15/16, the stock options would be worth $339.2 million. |
