Rory Read compensation and golden parachute

mrmt

Diamond Member
Aug 18, 2012
3,976
0
76
#1
Good morning guys. Have a look at Rory Read compensation package:

http://phx.corporate-ir.net/External.File?item=UGFyZW50SUQ9MTMwOTEyfENoaWxkSUQ9LTF8VHlwZT0z&t=1

RORY P. READ'S EMPLOYMENT AGREEMENT In connection with Mr. Read's appointment as President and Chief Executive Officer of the Company, he entered into an employment agreement, which provides for "at-will" employment. Pursuant to the terms of his employment agreement, Mr. Read is entitled to receive the following compensation and benefits:

• Base Salary. An initial base salary of $1 million. With respect to Mr. Read's initial base salary, the Compensation Committee reviewed certain competitive market data compiled by Compensia, Inc., its compensation consultant. Mr. Read's base salary fell within the 50th and 75th percentile of the competitive market data compiled from our custom peer group.

• Sign-On Bonus (Cash). A lump-sum, sign-on bonus of $1 million, up to half of which must be repaid if Mr. Read is not employed with the Company on the two-year anniversary of his hire date for any reason other than a Covered Termination. This sign-on bonus was provided in recognition of foregone bonus payments available to Mr. Read from his prior employer. For the definition of "Covered Termination," see the section titled "Employment and Related Agreements" below.

• Sign-On Bonus (Equity). A sign-on equity award of 143,000 restricted stock units, which vest 100% on the one-year anniversary of his hire date. This sign-on bonus was provided in recognition of forfeited equity awards when Mr. Read terminated his employment with his prior employer and joined AMD.

• 2011 Cash Bonus. A cash bonus equal to 150% of the portion of his base salary payable from August 25, 2011 through December 31, 2011. As a condition of his hire, Mr. Read negotiated for his 2011 cash bonus to be guaranteed. However, commencing in 2012, Mr. Read will participate in the EIP with an initial target bonus opportunity of 150% of his base salary and his cash performance bonus, if any, will be based on our achievement of specified performance goals. The Compensation Committee approved of Mr. Read's cash bonus being guaranteed at "target" because he joined the Company during the third quarter of 2011.

• Equity Awards. Additional equity awards consisting of (collectively, the "New-Hire Equity Awards"): (i) 717,000 time-based restricted stock units, which vest in three equal annual installments; (ii) 287,000 restricted stock units, which vest in three equal annual installments if (a) the volume weighted average closing price of our common stock over any 30-day period during the three-year vesting period is equal to or greater than $11.00 per share (the "Performance Target") and (b) Mr. Read continues his employment with us through each applicable vesting date; (iii) 1,847,000 time- based stock options, which vest in three equal annual installments; and (iv) 739,000 stock options, which vest in three equal annual installments if (a) the Performance Target is satisfied and (b) Mr. Read continues his employment with us through each applicable vesting date.

• Relocation Benefits. Relocation benefits consisting of: (i) two house hunting trips; (ii) packing, moving, and storage costs; (iii) trips between his prior home in Raleigh, North Carolina and Austin, Texas; (iv) temporary living and car rental; (v) an incidental allowance of $12,500; (vi) marketing assistance with the sale of his home; (vii) home loss protection to the extent the sale price of his home is less than the original purchase price; (viii) a home buyout option in the event Mr. Read is unable to sell his home within the first 12 months of his employment with the Company; (ix) a tax gross-up on the home loss protection; (x) normal non-recurring closing costs on the sale of his prior residence and purchase of his new residence; and (xi) other approved reasonable expenses. These relocation expenses, other than the home loss protection and tax gross-up on the home loss protection, are subject to a claw-back provision in the event Mr. Read's employment is terminated within two years of his hire date. In light of the Compensation Committee's extended efforts in attracting a high-caliber new Chief Executive Officer and to accelerate Mr. Read's mobility and advance his productivity, the Compensation Committee determined that it was in the best interests of AMD and our stockholders to extend Mr. Read these relocation benefits as a part of his compensation arrangements. The Compensation Committee believes the above relocation benefits were appropriate under the circumstances to attract Mr. Read to AMD.

• Severance. Certain severance payments and benefits as further described in the section titled "Executive Compensation–Employment and Related Agreements" below.

and his golden parachute:

Except as otherwise described in the next paragraph, in the event of Mr. Read's Involuntary Termination Without Cause or Constructive Termination: • We will pay Mr. Read his earned but unpaid Base Salary through the date of termination and all other amounts to which Mr. Read is entitled under any AMD compensation plan or practice on the date of termination.
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• All unvested equity awards then held by Mr. Read that would otherwise have vested during the 24-month period after Mr. Read's termination will be deemed fully vested, unless the Performance Target was not satisfied before the date of termination, in which case the unvested Performance RSUs and Performance Option will not vest.

• We will make a lump-sum cash payment to Mr. Read in an amount equal to two times his then Base Salary plus two times his then target Annual Bonus.

• We will pay any applicable COBRA premiums on behalf of Mr. Read and his dependents for a period of 12 months following the date of termination.
 

TemjinGold

Diamond Member
Dec 16, 2006
3,050
0
91
#2
Umm... okay. I don't have a problem with what other people make. That's their business.
 

inf64

Platinum Member
Mar 11, 2011
2,822
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#6
Why do you guys care how much he makes?Or whom AMD employs? Do you own their stock? Is it affecting you in some way? You guys always claimed that AMD is no competition and that intel won't increase the prices once they are gone,so why do you care how they do their business?

This is a honest question,I really like to know.
 

Martimus

Diamond Member
Apr 24, 2007
4,386
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#7
I am surprised he came so cheap. I would have expected a much larger compensation package for someone with the credentials Read had.
 

Jaydip

Diamond Member
Mar 29, 2010
3,691
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81
#8
I earn more guys, give it a break :p
 

mrmt

Diamond Member
Aug 18, 2012
3,976
0
76
#9
Why do you guys care how much he makes?Or whom AMD employs? Do you own their stock? Is it affecting you in some way? You guys always claimed that AMD is no competition and that intel won't increase the prices once they are gone,so why do you care how they do their business?
Actually because of my job I have interests in Intel, Dell, IBM, HP, Microsoft, SAP, Oracle, among others. I would have even more interest in AMD if they had relevant server products.
 

inf64

Platinum Member
Mar 11, 2011
2,822
45
136
#10
Actually because of my job I have interests in Intel, Dell, IBM, HP, Microsoft, SAP, Oracle, among others. I would have even more interest in AMD if they had relevant server products.
What does that have to do with how much AMD pays Rory Read? You didn't answer my question. Your interest in intel and co has not much to do with what you posted in the 1st post.
 

mrmt

Diamond Member
Aug 18, 2012
3,976
0
76
#11
What does that have to do with how much AMD pays Rory Read? You didn't answer my question. Your interest in intel and co has not much to do with what you posted in the 1st post.
I need to know who I'm dealing with. How would I give green light for a project containing AMD servers without knowing about AMD or their OEM partner? It is exactly because we do deep analysis of your partners that we didn't fall on the Bulldozer trap. And believe me, pay 15 million/year for Rory Read says a lot about AMD future situation.
 

inf64

Platinum Member
Mar 11, 2011
2,822
45
136
#12
CEOs of large semi companies usually have high salaries. It's no surprise RR has one too. And expecting him or anyone else to sit in that chair for less money ,especially in situation AMD is in today(with global economy not helping them) is a bit naive. Also how much they pay CEO has little to do with Bulldozer or any future project. Engineers do engineering,it's not CEO's job.
 

Idontcare

Elite Member
Oct 10, 1999
21,126
0
0
#13
I am surprised he came so cheap. I would have expected a much larger compensation package for someone with the credentials Read had.
For the challenge he was electing to sign up for, I am surprised he came so cheap too.

Maybe it was specifically because of the challenge? Rory wanted to take the opportunity to grapple with such a challenge either for sense of accomplishment in life or out of ambition to make a name for himself in the history books were he to successfully turn AMD around? (Jack Welch style)

Or maybe that is why it took the BoD so long to find a replacement for Dirk, because the BoD wouldn't budge on the compensation package after seeing Ruiz and Meyers walk away with millions and millions while not having done much for shareholders or employees?

There was a rumor that Pat Gelsinger was approached but turned down the job because the money was lacking.
 
Aug 25, 2001
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#14
There was a rumor that Pat Gelsinger was approached but turned down the job because the money was lacking.
That would have been an interesting outcome, for sure, had he accepted.
 
Mar 10, 2006
11,719
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#15
CEOs of large semi companies usually have high salaries. It's no surprise RR has one too. And expecting him or anyone else to sit in that chair for less money ,especially in situation AMD is in today(with global economy not helping them) is a bit naive. Also how much they pay CEO has little to do with Bulldozer or any future project. Engineers do engineering,it's not CEO's job.
AMD is not a "large" semiconductor. It's just a small way down to "small cap" territory.
 
Mar 13, 2006
10,126
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#16
Nothing to see here, compensation even looks a little skimpy to me. Two years of compensation after termination is on the low side of normal.

What point are you trying to make? If you do this research on every company you do business with as you claim, there's nothing about his compensation that is particularly post worthy.
 

mrmt

Diamond Member
Aug 18, 2012
3,976
0
76
#17
CEOs of large semi companies usually have high salaries. It's no surprise RR has one too. And expecting him or anyone else to sit in that chair for less money ,especially in situation AMD is in today(with global economy not helping them) is a bit naive. Also how much they pay CEO has little to do with Bulldozer or any future project. Engineers do engineering,it's not CEO's job.
Guys, seriously, do you think that Rory Read is a capable CEO and worth 15 million? Would Rory be on the top 10 names you can think for the position?
 
Mar 10, 2006
11,719
121
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#18
Guys, seriously, do you think that Rory Read is a capable CEO and worth 15 million? Would Rory be on the top 10 names you can think for the position?
No, but he's probably the only guy they could get to run the ship.
 

beginner99

Diamond Member
Jun 2, 2009
4,048
148
126
#19
Why do you guys care how much he makes?Or whom AMD employs? Do you own their stock? Is it affecting you in some way? You guys always claimed that AMD is no competition and that intel won't increase the prices once they are gone,so why do you care how they do their business?

This is a honest question,I really like to know.
Why? Because for about every 100k less e earns, they could employ 1 more engineer that would actually do something useful.

I guess my distaste for managements types comes through here. All i here is "buzzword blabla buzzword blablaba I have obviously no clue about what I decided buzzword".
 

pablo87

Senior member
Nov 5, 2012
374
0
0
#20
RR's package is nothing special - if it is, then let's add thousands of companies and CEO's to the conversation, shall we?

No good will come out of this thread.
 

nenforcer

Golden Member
Aug 26, 2008
1,763
0
76
#21
If you watch the AMD corporate videos in which he introduces himself to the employees he talks about how he already HAD a job with Lenovo, didn't need to take the position, but was too intrigued by the offer and opportunity.

Nobody wants to be known as a failure or running a company into the ground while making off with the spoils of its laborers.
 
Aug 11, 2008
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#22
No, but he's probably the only guy they could get to run the ship.
I am not impressed with RR so far, simply because he only seems to talk in marketing lingo that really says nothing. But I think it is too soon to say if he is a good CEO or not. That said, his compensation package seem outrageous to us "normal" people that work for 50-100 K per year and have no safety net except unemployment or finding another job on our own. In the context of CEOs though, it doesnt seem particularly outrageous.
 


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