• Jul 3, 2010
Soon-to-depart pay czar Kenneth Feinberg limited the cash remuneration available to General Motors executives, making stock options a go-to supplement for company leaders. It was reported last month that GM would hand out enough shares to top brass to create a $13 million payday for those on the list, with the windfall being totally dependent on the share price when the inevitable IPO hits.
Current numbers in BusinessWeek have revised that potential payday to $11.6 million. There were 123,347 shares disbursed, priced at $53.98 each, giving that tranche a nominal value of $6.66 million. BusinessWeek assumes GM has 500 million total shares, and working backwards from analysts' valuation numbers and bond prices, concludes that GM paper is worth roughly $94 per share. If the IPO goes by that market rate, there will be $11.59 million in the kitty. Ed Whitacre received the largest haul, of course, awarded $2.31 million in shares based on the forecasted $94 rate.

[Source: BusinessWeek]


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  • 32 Comments
      • 4 Years Ago
      It doesn't exactly work that way. They gave away equity, not assets (money).
      • 4 Years Ago
      6.66? Is the number mirror something? LOL!
      • 4 Years Ago
      Nice to be an executive.
      • 4 Years Ago
      While these 'bonuses' are distasteful, especially when performance measurements are rather lacking right now (during GM's ascension from death), their supposed worth is rather heartening.

      I WOULD like to see some forced retention period for these. How much harder would these execs try if they could not sell the proffered stock for 10 years? As of now, they could behave like old GMers, and just cash out before the next big fall (they cause) hits.
      • 4 Years Ago
      I have similar experiences with three recent GM cars. None of them post Obama's bailout, since I just can't imagine being associated with that.

      I hate the idea that my kids and their kids are going to be paying the interest on this loan to the unions that simply drove their companies out of business even though they earned 7 times a living wage. Ugly political power.

      Anyway, I had terrible reliability from 3 recent GMs. The only one that didn't fall apart was the Buick, which really was built better than my F150 and Accord were, I admit. But the Accord and F-150 are excellent. (The buick ruined in an accident).

      I just don't trust GM or anyone who claims they are a consistent maker of reliable cars. Maybe they are, but my family needs Honda or Ford quality so I can rest easy.
      • 4 Years Ago
      Is it any surprise GM does things like this now?
        • 4 Years Ago
        Wow, I just put that up a couple minutes ago, so GM Super fan, why are most of the cars made by GM are from other countries and are Goverment is paying for it?
        This is not to answer, just for you to think about.
        • 4 Years Ago
        No, of course not. Once the government limited the cash compensation of execs at these companies, they of course would line themselves up for huge bonus equity packages. It's as plain as the nose on your face.

        I'm not a fan of the level of executive compensation nowadays. But regardless, you aren't going to get good execs to come in and try to turn the company around when they can get a far less stressful job at a lower level in many other companies that pays as well or better, guaranteed.
      • 4 Years Ago
      "A lot has changed since 1965 buddy." You're right but.....

      GM building lousy cars is not one of them!
        • 4 Years Ago
        Good thing GM never built lousy cars in the first place...
      Dinny
      • 4 Years Ago
      Nice, after going bankrupt to scr[w suppliers, Dealers and salaried employee's this bunch gets a nice bonus. Like everything else the little guy gets it in the end...and I mean the rear end.
      • 4 Years Ago
      Except that he clearly states that he drives Fords...
      • 4 Years Ago
      Now on this compensation. It is a joke. The argument that GM most do this to get the best people is a joke. That logic may have worked 30 years ago when American believed in greed. Today, the labor pool of talent is stronger. You can find a good executive that will devote his life to a company for much less. Companies do need strong leaders, but pay that exceeds the average worker pay by over 500% is ridiculous. This system is what bankrupt GM and many US companies. Sorry, no worker is worth that much. Fair compensation must be in every companies bylaws. The engineer who designed the car is worth just as much as the sales executive and the assembly line engineer who keeps the machines working. Time has come to limit compensation and put an end to this equity injustice. Oh GOD, I am sounding like a communist. I do believe that pay should be based on performance. So all those GM executives owe the US taxpayer a huge refund. That goes for every company, Enron, AIG, Citibank, etc. Shareholders should get a bigger cut of profits not invested back in the company and a maximum compensation legislation law enacted. For example, you get stock options that pay out over 100% of your base salary, it should be taxed at 80%. That will force companies to pay more to shareholders and employees. It will lead to more investment, jobs, and maybe start a new technology explosion.
      • 4 Years Ago
      6.66? Is the number mirror something? LOL!
      • 4 Years Ago
      Cruze is not the only car that GM makes.

      FYI -GM still sells more cars than any other OEM in the US>

      If they are able to be profitable on each vehicle that they sell 6Mil.will be pocket change for GM.
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