Amazon books show how it lured top exec
The online retailing giant is paying its new president and chief operating officer $200,000 per year with stock options likely to be worth at least $20 million.
Until April, Joseph Galli, 41, was the president of Black & Decker's Worldwide Power Tools and Accessories unit, a $3.1 billion business representing nearly 70 percent of the company's sales. Galli, who joined Amazon in late June, reports to the company's founder and chief executive, Jeff Bezos.
Galli's generous compensation package reflects the power technology companies have to entice high-caliber executives from traditional manufacturers and retailers. Despite offering lower base salaries, technology firms have wooed star executives with stock option awards that are hard to turn down given soaring stock values over the long bull-market run.
According to Amazon's latest filing with the Securities and Exchange Commission, Galli is also entitled to a $5 million signing bonus, paid in two installments. On his first anniversary at Amazon, Galli will receive $3 million, and he will reap another $2 million on his second anniversary at the company.
Galli also received two stock option awards, totaling 1.96 million shares. One package of 735,000 shares vests at 10 percent increments over 20 years. The other 1,225,000 shares vest at 10 percent increments after the first ten years of service.
Amazon awarded Galli a strong safety net in case the company's stock price tumbles and his stock options dive under water--or below the strike price value of about $113.
This provision allows Galli to qualify for a bonus as large as $20 million if he still works for the company on his fourth anniversary of service.
Shares of Amazon closed at 128.56 yesterday, and have traded as high as 221.25 and as low as 21.66 during the past 52 weeks.