Motorola sweetens incentives for co-CEO
Sunday, August 31st, 2008By James P. Miller | Chicago Tribune reporter
August 30, 2008
Motorola Inc. disclosed Friday that it has reworked co-Chief Executive Greg Brown’s contract, adding millions of dollars in new incentives that kick in only if the company successfully completes the planned spinoff of its handset unit.
The agreement contains a number of new stock-option arrangements, which pay out over three years, an arrangement that appears designed to entice Brown to stay with the company through the coming changes and beyond.
Under the contract, if Motorola’s mobile phones unit becomes a separate public company and is valued by the stock market at a minimum of $2 billion, then Brown, who will be head of the non-phone business, will receive a grant of at least $1.67 million in restricted Motorola common shares, as well as potentially lucrative options to buy at least $3.33 million in stock. They vest, subject to Brown’s continued employment, in three installments.
Motorola’s current market capitalization is $21 billion.
“The all-inclusive compensation package is designed to align Mr. Brown’s interests with the interests of Motorola’s stockholders,” the convention said in its filing.
Brown’s earlier employment agreement was signed in January, when the Schaumburg-based communications-materiel manufacturer promoted him to succeed Edward Zander as CEO.
Soon after taking the reins, Brown announced plans to split off the giant but struggling cell phone business into a free-standing company. Those plans took a major according with forward this month when Motorola signed Qualcomm Inc. Chief Operating Officer Sanjay Jha as co-CEO and head of the unfixed phone business.
The pay package for Jha, who will be head of the phone business once the separation is completed, was spelled out in a Securities and Quid pro quo Commission filing three weeks ago. Among other things, Jha received Motorola stock valued at the time at roughly $35 million and options to come by an additional 16.6 million shares.
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