Good questions! Here's a short-ish answer:
Of those shares, however, fully 1,201,125 are in the form of options, the right to buy an identical number of Gannett shares from the company at a fixed price, no matter how high shares trade in the open market. That means he owns just 44,631 of those combined 1,245,756 shares outright. On paper, this smaller block is worth about $636,000, based on today's recent trading price of $14.25 a share.
But that doesn't mean all those 1.2 million options are without value. The board of directors awarded him 500,000 options last year and another 480,000 this year as part of his annual compensation. They were included in a raft of options awarded to the company's top executives.
Last year's 500,000 options can be cashed in -- or exercised -- for just $3.75 a share (the so-called strike price) beginning in four equal annual installment starting this past Feb. 25. If Gannett's stock continued to trade for about where it is today, those options would eventually leave him with a net $5.3 million.
Gannett's SEC documents show Dubow and President Gracia Martore have not exercised any of their options from last year -- unlike other top executives.
This year's 480,000 options carry a higher strike price, however: $15. They are currently worthless, since that strike price is higher than the current market price of $14.25. In any case, these options can't be exercised until starting Feb. 24, 2011.
An important note on Dubow's annual pay: the options listed above are in addition to the combined $7.4 million the board paid him in base salary and bonuses in 2007, 2008 and 2009. Virtually all of that was in cash, too, and came during a period of massive layoffs. (Summary compensation table for those three years.)
Related: stock ownership for all executives and other big investors
Up? Down? Where do you think Gannett shares will be a year from now? Please post your replies in the comments section, below. To e-mail confidentially, write jimhopkins[at]gmail[dot-com]; see Tipsters Anonymous Policy in the rail, upper right.
He turns 56 on October 26, when he becomes eligible for early retirement. Don't be surprised if he's gone by year end.
ReplyDeleteIn that case, I think his options continue to vest for three years after his retirement date. But I need to confirm that.
ReplyDeleteOtherwise, the board of directors probably could accelerate the schedule so that all his options vest immediately. But they will might be worthless unless the stock moves higher than current levels.
Jim you are wrong. If you read the proxy correct you would have read this: A table of total common shares owned by top 20.
ReplyDeleteName of Beneficial Owner (1)
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Shares
Owned
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Percent of Class
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Ariel Investments, LLC(2)
14,770,694 6.2 %
The Vanguard Group, Inc.(3)
12,679,066 5.3 %
Craig A. Dubow
1,245,756 *
Gracia C. Martore
451,829 *
Robert J. Dickey
176,713 *
David L. Hunke
156,461 *
Christopher D. Saridakis
115,607 *
Howard D. Elias
3,250 *
Arthur H. Harper
33,868 *
John Jeffry Louis
282,356 *
Marjorie Magner
6,750 *
Scott K. McCune
4,250 *
Duncan M. McFarland
39,300 *
Donna E. Shalala
43,789 *
Neal Shapiro
2,250 *
Karen Hastie Williams
8,000 *
All directors and executive officers as a group (23 persons including those named above)
3,636,832 1.5 %
--------------------------------------------------------------------------------
This table is the number and % of common shares not options. Alone Dubow owns 1,245,756 of common GCI Stock.
Jim he owns 1,245,756 of common. They are not options but he has to hold on to recent awarded common stock for 3 years.
ReplyDeleteI'm basing my calculations on footnote No. 1 in the table I've linked to at the bottom of this post. Are we all looking at the same table?
ReplyDeleteask Gannett investor relations to clarify. Because what I have read he owns 1,245,756 as of 2009 annual report.
ReplyDeleteOn further examination, those 1.2 million options might not include the 980,000 from last year and this year. But I believe the dollar amounts I cite remain the same, because these 1.2 million have strike prices so high, they're currrently worthless.
ReplyDeleteSaridakis was the smartest one. Sold out all his shares at the peak! Oh and he also got out at the right time.
ReplyDeleteJim: Is Dubow in line to get a regular pension like other Gannett employees, or is there some special deal (other than stocks and stock options) that those who wear the purple robes have wrangled? If they had to pay a pension on the basis of his salary, it would be a real hit on the pension pool.
ReplyDeleteThis comment has been removed by a blog administrator.
ReplyDeleteDublow is the character Tim Robbins played in the movie The Hudsucker Proxy, in which the devious board of directors names a hapless mailroom clerk as CEO in order to drive down the price of the company's stock so that they can buy the company and take it private at a much cheaper price.
ReplyDelete