GM grants stock options to 300 execs
Detroit — General Motors Co. has granted its first stock options to 300 executives including CEO Mary Barra, the first stock options granted by the automaker since it emerging from bankruptcy as a new company in 2009.
The grants were awarded Tuesday as part of the company’s previously approved 2014 long-term incentive plan, the company said in a regulatory filing this week.
Barra received more than 2.6 million in stock options while GM President Dan Ammann received 976,139 and Mark Reuss, GM’s head of global product development, purchasing and supply chain, received 829,719. Chief Financial Officer Chuck Stevens received 623,645 in options and Karl-Thomas Neumann, GM president of Europe and chairman of the management board of Opel Group, received 585,684.
Executives awarded the options can exercise them after they vest and pursuant to terms of the award and incentive plan. The stock options require executives to meet certain performance measures and GM must have a stock price higher than $31.32, Tuesday’s closing price on the New York Stock Exchange.
“The grant will be made to senior leaders of the company to maintain the leadership consistency needed to achieve the company’s short- and long-term goals,” GM said in the filing. “As a condition of accepting the grant, each recipient will be required to execute an award agreement containing non-compete and non-solicitation covenants.”
GM said its competitors offer stock options and GM hadn’t done so. A spokesman said the non-compete and non-solicitation clauses also will help GM retain its top executive talent.
The executives will only benefit if GM’s stock price appreciates. Once vested, GM executives can exercise their option to buy company shares with their own cash at the $31.32 price and hold the shares. Or they then could buy and sell shares of stock and net the gained difference.
GM said 40 percent of the options will vest on Feb. 15, 2017, and the rest will vest upon the company achieving performance targets. The carmaker said those performance stock options will vest in three annual amounts starting Feb. 15, 2018, if the company’s total shareholder return equals or is greater than the average performance a peer group of automakers that GM will track.