Microsoft discloses loan to executive
The software giant discloses that it gave a loan now worth $13.1 million to an executive to lure him away from an investment banking job.
In a proxy filed with the Securities and Exchange Commission Thursday, Microsoft stated that it had given Richard Emerson, a senior vice president for corporate development, a loan of $12 million when he was hired in November 2000. The loan was an advance against the value of stock options he received.
Emerson had been managing director and co-head of technology and telecommunications advisory services at investment bank Lazard Freres.
Earlier this month, Microsoft disclosed that it had forgiven a $15 million loan to former President and COO Richard Belluzzo, who has since been named CEO at data-storage maker Quantum. Microsoft said then that the loan was an advance payment against the "minimum benefit" value of 3.5 million stock options Belluzzo was given in 1999 and 2000. The company reported that Belluzzo forfeited the options and received a $350,000 bonus.
In the filing, Microsoft said it would no longer make loans of this type to executives, since they have been prohibited under the Sarbanes-Oxley Act of 2002.
Also in the proxy, the company reported that CEO Steve Ballmer earned a salary of $547,500 for 2002, as well as a $205,810 bonus. That's up from the $665,520 he received in salary and bonus a year ago. Chairman Bill Gates got the same compensation as Ballmer. Neither Gates nor Ballmer received or exercised stock options in 2002.
Belluzzo earned $918,723 in salary and bonus for 2002, up from $818,758 in 2001. Belluzzo left the company in August. In addition to his salary and bonus, he received extra compensation of $13.68 million, including $13.6 million related to stock options, $25,626 for personal use of a company aircraft and $5,000 in contributions to his 401(k) plan.
The proxy also indicated that Gates' ownership of the company has dropped to 11.6 percent, down from 12.3 percent in the previous year.