Hmmm, business geek gets signing bonus...

[Panama Red]

Not bad for walking in the door!

http://www.msnbc.msn.com/id/7346786/

[rjfvillarosa]

Quite likely a sign of things to come for when they boot him out the door for failure.

[doctorgonzo]

Hmm, I'm sure there's a perfectly good explanation as to why they are giving him 400x the average HP worker's annual salary for showing up to work.

Maybe he has a special talent and HP will soon be selling golden eggs?

[mbossman2]

While it is a significant amount of money, much of it is tied to the overall performance of the company:

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.

So $2million is "cash", the $2.75million may or may not be direct cash (it probably offsets some of his relo costs - which can be alot - especially if you have to commute across the country while prepping for a move). As to the options, if HP's value drops then the options aren't worth the paper they are written on and the restricted shares will also drop in value (I am sitting on several thousand shares myself that are worth less than nothing) and those restricted shares are generally unsaleable unless certain criteria are met.

So on paper he makes a boat load up front...but remember, the future of a $2 billion dollar company rests on his shoulders: with great risk comes great reward.

[jong2k4]

but not great risk to him - if he fails dramatically then his only penalty is having his annual bonus reduced to $2.8 million from $8.4 million. Would that we were ALL in such tenuous situations.

[David M]

Talent is not free. If he doubles comapany revenues he has paid for himself many times over. Thats capitalism. Thats life in a free society.

[Jaggannath]

Obscene... and companies wonder why they can't turn their fortunes around. I wish him luck

[mbossman2]

Originally Posted by Jaggannath Obscene... and companies wonder why they can't turn their fortunes around. I wish him luck

actually if you look at the total picture, this is chump change:

HP's total annual sales: $620,928,000
HP's Annual Net Profit: $4,359,000 (down from $63,000,000 less than 2 years ago).

So lets say that the new CEO implements policies that brings their overall profitability back to half of what it was in 2002 (~$31.5million), wouldn't that be worth a bonus of ~$8million? or to ask it another way: would you spend $8 to get $27?

While the move is risky, HP is on the knife's edge between success and failure, they haven't lost money (yet) and desperate times call for desperate measures.