Prince of PAWOBs
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Someone should ask Doug about the stock options and taxes in CLT on Wednesday. I wonder how he'll respond...
Execs Dumping Stock
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BoeingBoy
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PITBull & Dio,
Actually the company makes it easy - the expiration dates of the options exercised are given on the SEC filings which are available on the company website, as is the exercise price and date they became exercisable.
The options have a "life" of 10 years from the grant date until expiration so, while I didn't do it, it's easy to tell when they were originally granted.
Frankly, the income tax angle comes from memory - something I recall seeing in one of the big filings at the time of the actual merger / BK exit / issuance of new stock.
Jim
Actually the company makes it easy - the expiration dates of the options exercised are given on the SEC filings which are available on the company website, as is the exercise price and date they became exercisable.
The options have a "life" of 10 years from the grant date until expiration so, while I didn't do it, it's easy to tell when they were originally granted.
Frankly, the income tax angle comes from memory - something I recall seeing in one of the big filings at the time of the actual merger / BK exit / issuance of new stock.
Jim
PITbull
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Bob,
When we had our (AFA) options given in BK #1 (90 shares) the talk of BK#2 was looming. Many of us sold our measlely shares (of course at a loss) I think I received about $127. The company had discussed with us initially that the taxes would come out BEFORE the distribution. In other words, our shares were to be 90 shares (two distributions) and the company automatically reduced them from us to cover the taxes. The company took the taxes out in shares that were returned back to the company before we even exercised the shares.
To this day I can't figure out how they calculated the tax and the reduction of shares to cover it.
When we had our (AFA) options given in BK #1 (90 shares) the talk of BK#2 was looming. Many of us sold our measlely shares (of course at a loss) I think I received about $127. The company had discussed with us initially that the taxes would come out BEFORE the distribution. In other words, our shares were to be 90 shares (two distributions) and the company automatically reduced them from us to cover the taxes. The company took the taxes out in shares that were returned back to the company before we even exercised the shares.
To this day I can't figure out how they calculated the tax and the reduction of shares to cover it.
While I can understand the vitriolic anger directed at the rich who just keep getting richer, the fact remains that the lenders and new investors who enabled the HP deal (without whom US might not have survived) approved the terms of these stock options to the executives. So did the bankruptcy judge.
They couldn't unload for nine months. That restriction has ended.
Yes, the employees at the bottom suffered paycut after paycut. That's what happens when your employer files multiple bankruptcies and the various work groups are so addicted to their seniority that they approve massive wage cuts instead of moving on. Did anyone really think the executives would forego their big stock payoff indefinitely? In their mind (and the lenders/investors minds), they earned every penny of this windfall for keeping the debt service machine we call LCC alive yet again.
They couldn't unload for nine months. That restriction has ended.
Yes, the employees at the bottom suffered paycut after paycut. That's what happens when your employer files multiple bankruptcies and the various work groups are so addicted to their seniority that they approve massive wage cuts instead of moving on. Did anyone really think the executives would forego their big stock payoff indefinitely? In their mind (and the lenders/investors minds), they earned every penny of this windfall for keeping the debt service machine we call LCC alive yet again.
PITbull
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FW,
It beyond anger and disqust. The employees made the sacrifice to enable the company to emerge and survive; not for the Execs to circumvent their so called salary decreases in bk by now having instant wealth less than a year later out of BK.
Do the execs really think that LABOR will forgo their wages and benefit reductions INDEFINITELY...do they really????
With regard to YOUR comment about seniority...AFA REALLY HELPED THE COMPANY WITH THAT ISSUE. The VF program was all about seniority and all about giving relief to the company on the higher paid workers and furloughing them on a voluntary basis...this was so effective that 2,100 f/as took the VF (with ability to extend in 6 months intervals) on Dec. 2 ,2001. Since that furlough, 6,700 have been voluntarily furloughed with approx 14,00 on indefinite extended leave. IN ADDITON TO THAT, 1200 additional f/as took a VOLUNTARY FURLOUGH LIMITED RECALL which means these senior folks, if recalled, would come back at year one!!!!
SO, MY FRIEND, AFA BENT OVER HUGE TO HELP THIS COMPANY WITH THE ISSUE THEY SAW IN employee SENIORITY, AND THAT WAS IN ADDTION TO THE WAGE CUTS (3 OF THEM) BENEFITS, DUMPTING PENSIONS AND WORK RULES.
Am I angry that my particular sacrifice of my job at 25 year service to the company along with many of us who left rewards ONLY the senior execs of USAirways...YOUR DAMN RIGHT I AM FLIPPING OUT!!!
You just tell those bastards that if I were on the property today, their stock would be worth much lower, and I would be causing some major shittt over this issue of EXECS instant wealth while the rank still is suffering the effects of the bk consessions... :angry:
You need to correct your post regarding senior folks WHO DID SACRIFICE THEIR JOBS.
And with regard to Fleet service, same issue. Their seniority is only maintained for 90 days, then, if they get recalled, its back to new hire. Some of those folks HAD OVER 20-25-30 YARS!!!
DP and Kirby have been with the company for over 10 years...they need to move on and bring in some new talent AT LESS PAY, STOCK AND BENNIES and give some financial-exec relief to the company!!!!
YOU NEED TO TERMINATE CRELLIN AND HEMENWAY CAUSE THEY HAVE BEEN WITH U FOR OVER 30 YEARS AND WAY TO EXPENSEIVE FOR THE COMPANY RANK AND FILE TO MAINTAIN!!!
Way I see it, we have a senior exec seniority issue.
MarkMyWords
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- Aug 20, 2002
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thanks Jim....
I knew you would find the facts/info. It is always a lesson in education on here. As i said before, I am no an expert on stock options....the information is appreciated.
I knew you would find the facts/info. It is always a lesson in education on here. As i said before, I am no an expert on stock options....the information is appreciated.
PITbull
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- Dec 29, 2002
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Are you not going to make any comment on the income tax implication at company expense????
Can you just put down the koolaide for a second? Or doesn't that payout mean anything to you inspite of the sacrificing of wages benefits and job losses given by the rank and file?
Does your appreciation of the information change your opinion on the subject...or not?
PITbull
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- Dec 29, 2002
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ah, Geezus Bob, you must be making a funny...
These execs DO NOT own the company. Where did you get that thought from?
This is a publically traded company and outside the execs that get granted stock options contractually, EVERY ONE ELSE HAS TO PAY FOR THEIR SHARES AND RISK.
My problem with this is this, 9 months after emerging from BK, these senior EXECS get a windfall, I don't have to like it or accept it and neither do the rest of the rank and file.
These execs huge pay day was had only because the majority of the rank and file employees sacrificed their jobs, wages, pensions, and benefits to secure a company. I DO NOT BELIEVE OR AGREE THAT THE ONLY FOLKS THAT SHOULD BENEFIT FROM THIS ARE EXECS. Why in hell should the employees now have to pay for the income tax on this exec windfall????
Its wrong to think that the employees should accept this. I gave up my job to add to the 1200 senior folks that needed to leave in concession #3.
I am a customer of U and I can surely see the inequity here regardless of my FF customer status.
I can see very clearly the silence from many of these management-protectors. Their silence is deafening. I just wish to hell they would protect the rank and file at a small % as they do the Execs.
It's appalling. And whether you like it or lump it, or anyone one here likes it or not....I WILL MOUTH OFF FROM HERE TO KINGDOM COME OR UNTIL THE EMPLOYEES GET THEIR WAGES SNAPPED BACK!!!! And not a day before!!!
I don't want to see my sacrifices in the company to be squandered on the likes of greedy execs, Glass and Company union busters. My intent in leaving was never to walk away in silence. No sir. The 25 years I gave to this company has value, and I want to ensure in principle that it is not squandered to make rich a bunch of executives.
As you will note specifically, DP restrained from cashing in and postponing his bonus, therefore,
IT CAN BE DONE!!!!
MOVE ON???? DON'T SPEAK OF IT???? SHOW SOME RESTRAINT?????
NOT ON YOUR LIFE...
These execs DO NOT own the company. Where did you get that thought from?
This is a publically traded company and outside the execs that get granted stock options contractually, EVERY ONE ELSE HAS TO PAY FOR THEIR SHARES AND RISK.
My problem with this is this, 9 months after emerging from BK, these senior EXECS get a windfall, I don't have to like it or accept it and neither do the rest of the rank and file.
These execs huge pay day was had only because the majority of the rank and file employees sacrificed their jobs, wages, pensions, and benefits to secure a company. I DO NOT BELIEVE OR AGREE THAT THE ONLY FOLKS THAT SHOULD BENEFIT FROM THIS ARE EXECS. Why in hell should the employees now have to pay for the income tax on this exec windfall????
Its wrong to think that the employees should accept this. I gave up my job to add to the 1200 senior folks that needed to leave in concession #3.
I am a customer of U and I can surely see the inequity here regardless of my FF customer status.
I can see very clearly the silence from many of these management-protectors. Their silence is deafening. I just wish to hell they would protect the rank and file at a small % as they do the Execs.
It's appalling. And whether you like it or lump it, or anyone one here likes it or not....I WILL MOUTH OFF FROM HERE TO KINGDOM COME OR UNTIL THE EMPLOYEES GET THEIR WAGES SNAPPED BACK!!!! And not a day before!!!
I don't want to see my sacrifices in the company to be squandered on the likes of greedy execs, Glass and Company union busters. My intent in leaving was never to walk away in silence. No sir. The 25 years I gave to this company has value, and I want to ensure in principle that it is not squandered to make rich a bunch of executives.
As you will note specifically, DP restrained from cashing in and postponing his bonus, therefore,
IT CAN BE DONE!!!!
MOVE ON???? DON'T SPEAK OF IT???? SHOW SOME RESTRAINT?????
NOT ON YOUR LIFE...
BoeingBoy
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Piney,
You are absolutely correct - to all appearances these execs did absolutely nothing illegal. The "10b5-1 financial plans" allow company insiders to trade company stock, even on the basis of confidential inside information, as long as a plan is in place that places the insider "at arms length" from the transaction - i.e., having no way to change the terms of the proposed sale after the initial instructions are given.
The example the SEC used to illustrate this is a standing order to sell company stock in an amount that will pay for a child's college tuition when each tuition bill comes due. While I see no evidence that these exec's sales was of such a routine and periodic nature, but merely being unable to change one's mind after the details of the sale were specified seems to be enough to avoid any penalties normally associated with illegal insider trading.
Were these sales unseemly, however? I'd say so, in light of the sacrifices that have been made by so many to make this merger and the resulting stock price possible. Then there's the sacrifices still being asked of so many.
Ironic, isn't it, that these "10b5-1 financial plans" were just set up in May - the same month that the stock reached an all-time high and the new website was unveiled. Plans that have been entirely legal since 2000.
Also ironic that these same insiders had so much faith in HP - I've gone back as far at the start of 2004 and none converted options to sell HP stock - and apparently so little in LCC. Or maybe all those $$ signs were just to irresistable. Who was the old west outlaw that said he robbed banks because that was where the money was? Seems that LCC is where the money is for some.....
Jim
You are absolutely correct - to all appearances these execs did absolutely nothing illegal. The "10b5-1 financial plans" allow company insiders to trade company stock, even on the basis of confidential inside information, as long as a plan is in place that places the insider "at arms length" from the transaction - i.e., having no way to change the terms of the proposed sale after the initial instructions are given.
The example the SEC used to illustrate this is a standing order to sell company stock in an amount that will pay for a child's college tuition when each tuition bill comes due. While I see no evidence that these exec's sales was of such a routine and periodic nature, but merely being unable to change one's mind after the details of the sale were specified seems to be enough to avoid any penalties normally associated with illegal insider trading.
Were these sales unseemly, however? I'd say so, in light of the sacrifices that have been made by so many to make this merger and the resulting stock price possible. Then there's the sacrifices still being asked of so many.
Ironic, isn't it, that these "10b5-1 financial plans" were just set up in May - the same month that the stock reached an all-time high and the new website was unveiled. Plans that have been entirely legal since 2000.
Also ironic that these same insiders had so much faith in HP - I've gone back as far at the start of 2004 and none converted options to sell HP stock - and apparently so little in LCC. Or maybe all those $$ signs were just to irresistable. Who was the old west outlaw that said he robbed banks because that was where the money was? Seems that LCC is where the money is for some.....
Jim
Bob,
Isn't it interesting how original intent gets twisted around after 200 years or so?
For instance, the freedom the Constitution talks about has been twisted to mean business can do any old thing they please. This despite:
"Section 8. The Congress shall have power to lay and collect taxes, duties, imposts and excises, to pay the debts and provide for the common defense and general welfare of the United States; but all duties, imposts and excises shall be uniform throughout the United States;
To borrow money on the credit of the United States;
To regulate commerce with foreign nations, and among the several states, and with the Indian tribes;"
OTOH, look at the roadblocks to organize a union, despite this:
"Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the government for a redress of grievances.
Forming a business or church is as easy as falling off a log. A union? Not so much.
Let's look at property rights. Say a parcel of land with a nice creek flowing thru it has been in a family for a while. They've swam and fished the creek, got married there, spread some ashes there.
Now, a hog farm goes into operation upstream. Pretty soon, the creek is unswimmable, and you wouldn't eat the fish. You can't bear to be outside for the stench.
It's clear there has been a taking of property.
The court cases to date do not uphold the family's rights. They DO uphold the hog operator.
This despite:
No person shall be held to answer for a capital, or otherwise infamous crime, unless on a presentment or indictment of a grand jury, except in cases arising in the land or naval forces, or in the militia, when in actual service in time of war or public danger; nor shall any person be subject for the same offense to be twice put in jeopardy of life or limb; nor shall be compelled in any criminal case to be a witness against himself, nor be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.
The state is quite vocal about the public good these operations have on the economy.
There is no doubt we live in a capitalist society. That is not to say it is a natural result of our founding (Jefferson strongly opposed a central bank, and I think he was onto something), or as inevitable as gravity.
It is the result of money filling the vacumn citizens have negligently created.
Isn't it interesting how original intent gets twisted around after 200 years or so?
For instance, the freedom the Constitution talks about has been twisted to mean business can do any old thing they please. This despite:
"Section 8. The Congress shall have power to lay and collect taxes, duties, imposts and excises, to pay the debts and provide for the common defense and general welfare of the United States; but all duties, imposts and excises shall be uniform throughout the United States;
To borrow money on the credit of the United States;
To regulate commerce with foreign nations, and among the several states, and with the Indian tribes;"
OTOH, look at the roadblocks to organize a union, despite this:
"Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the government for a redress of grievances.
Forming a business or church is as easy as falling off a log. A union? Not so much.
Let's look at property rights. Say a parcel of land with a nice creek flowing thru it has been in a family for a while. They've swam and fished the creek, got married there, spread some ashes there.
Now, a hog farm goes into operation upstream. Pretty soon, the creek is unswimmable, and you wouldn't eat the fish. You can't bear to be outside for the stench.
It's clear there has been a taking of property.
The court cases to date do not uphold the family's rights. They DO uphold the hog operator.
This despite:
No person shall be held to answer for a capital, or otherwise infamous crime, unless on a presentment or indictment of a grand jury, except in cases arising in the land or naval forces, or in the militia, when in actual service in time of war or public danger; nor shall any person be subject for the same offense to be twice put in jeopardy of life or limb; nor shall be compelled in any criminal case to be a witness against himself, nor be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.
The state is quite vocal about the public good these operations have on the economy.
There is no doubt we live in a capitalist society. That is not to say it is a natural result of our founding (Jefferson strongly opposed a central bank, and I think he was onto something), or as inevitable as gravity.
It is the result of money filling the vacumn citizens have negligently created.
I never said it was illegal and agree that it is unethcial and immoral. Having said that, havent judges thrown out contracts? So much for a contract is a contract...I guess it depends on whose contract.
KCFlyer
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- Aug 20, 2002
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I think the issue here Bob is this...you said AFA has a contract...as well as IAM, ALPA, USWA, TWU. But I would say that it's more accurate to say that AFA and the others had a contract...and amended it to help the company. I would also submit that while the executives might feel that they deserve the "fruits of their labors", they would have NO fruits if it were not for the concessions of the aforementioned labor unions. How many times...not just as US, but at DL, NWA and UAL have we seen "without concessions from labor, liquidation is imminent". You know, the the IAM struck Eastern and forced them into liquidation. At the time I could not understand how they could have done that. But today, I am seeing quite well why they did. They gave and gave and gave again - and the company emerged from bankruptcy. What's pretty much the first order of business? Reward the executives for a "job well done".
One has to wonder...if Southwest were in dire enough financial straits to require concessions from their labor groups, would the executives richly reward themselves for achieving these cost savings? My gut feeling says no, they wouldn't. Becuase as big as Southwest has become, I honestly believe that they see what the executives of every other airline is missing...without the line workers - we are nothing.
IMHO, come contract time for AFA and ALPA and the others, this little incident is going to come back and bite the executives in the butt. As well it should.
PITbull
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- Dec 29, 2002
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It's not unique that you won't see MMW OR Eric-blow-fish post one more post on this thread. They will avoid it and just wait until it disappears.
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