HP is giving Mark V. Hurd, its new chief executive, quite the welcome:
Hurd’s package includes a $2 million signing bonus, a $2.75 million cash “relocation allowance,” 1.15 million stock options valued by the company at $6.9 million and 400,000 restricted HP shares worth about $8 million.
In addition to the relocation allowance, Hurd will also receive free housing for a year and a four-year “mortgage interest subsidy.” There will also be “no limit on the weight of household goods” he chooses to ship to California, according to the agreement.
In addition, the contract calls for HP to reimburse Hurd for up to a 20 percent decline in the value of 850,184 shares he owns in the firm he is leaving behind, Dayton, Ohio-based NCR Corp.
In addition to the signing money, Hurd’s contract calls for an annual salary of $1.4 million, an annual bonus of at least $2.8 million and as much as $8.4 million, and long-term incentive payments of between $4.2 million and $12.6 million per year. HP spokeswoman Monica Sarkar said the long-term incentive payments are not guaranteed.
In the employment agreement, HP said 450,000 of the stock options, valued at $2.7 million, and the 400,000 restricted shares were awarded “to make up for compensation forfeited from” Hurd’s previous employer. HP spokeswoman Sarkar said the amounts were based on what Hurd was “leaving on the table” at NCR.
I especially liked the free housing for a year and four-year “mortgage interest subsidy”. It’s tough to make mortgage payments when you’re scraping by on just $1.4 million per year. At least the $2.75 million relocation allowance will help out a bit.
Am I ever glad I don’t own HP stock.