Martin Rosenbaum, member of Maslon's Business and Securities Team, is quoted in a Saint Paul Pioneer Press
article titled "For Minnesota CEOs, bonuses whacked, but pay stays intact." The article, published on June 7, 2009, reports that median bonuses for chief executives at the states largest companies were cut in half from 2007 (to just under $400,000), while median pay dropped only 1.3 percent (to $3.2 million). The article explains, however, that the original value of stock and option awards plays heavily in the calculation of executive compensation, and today are worth a significant amount less than when they were originally granted.
Rosenbaum states, "Some of those grants . . . are never going to lead to the accumulation of wealth by the executive." He goes on to explain, "That presents a challenge going forward for compensation committees. Board members must consider whether to let the CEO suffer with his or her underwater stock options, or replace them with options that give the executive a better shot at a pay day and, therefore, more incentive to stick around."
To view the full article, go to: http://www.twincities.com
/ and search "For Minnesota CEOs, bonuses whacked, but pay stays intact."