Blockbuster Entices the Brass29 Sep, 2005 By: Erik Gruenwedel
In the face of recruitment shortfalls, the U.S. Army significantly increased monthly stipends and related benefits to soldiers considering re-enlistment and deployment to Iraq.
Now, Blockbuster Inc., facing a languishing stock and flat rental market, has offered six executives restricted stock options up to 142,000 shares each if select performance goals are met.
The executives who agreed to the stock incentives are Frank Paci, EVP finance and accounting, (45,500 shares); Nicholas Shepherd, EVP Blockbuster North America (142,200); Ed Stead, EVP general counsel, (102,400); Eileen Terry, EVP franchising, (41,100); Christopher Wyatt, EVP international, (102,400); and Larry Zine, EVP and CFO (142,200).
The aforementioned group must help Blockbuster achieve undetermined “adjusted operating income” goals in addition to in-store and online subscriber quotas over a two-year period from Jan. 1, 2005 through Dec. 31, 2006.
While Blockbuster's travails do not rival the mean streets of Iraq, Wall Street can exact financial cruelties made all the more certain when management flees the combat zone. Big Blue's enticements — however ignorant of its rank-and-file employees — would appear to be a much-needed boost.