Mott, who before becoming CIO at Dell spent 22 years at Wal-Mart Stores, will have a base salary of $690,000, an option to buy 500,000 shares of HP common stock and a targeted short-term bonus opportunity of 100 percent of base salary guaranteed at target for the remainder of fiscal 2005 and fiscal 2006, according to the filing.
"In order to replace benefits that Mr. Mott is forfeiting by leaving his current employment, HP also agreed to provide a signing bonus of $2.2 million," HP, the No. 2 computer maker after IBM, said in the filing.
Compensation experts said new HP CEO Mark Hurd is known as a savvy hirer and that Mott will likely add more value than the cost of his pay package during his tenure at HP, which.
"You have a very complex global business with HP, and maybe there's a lot you can learn about how IT is leveraged at the most efficient supply chain company in the world," Richard Spitz, global managing director of the technology practice at executive search firm Korn/Ferry International, said of Dell.
"Mark Hurd has got a reputation of being very shrewd in his hiring," Spitz said. "I think HP's made a brilliant move."
Dell, the No. 1 PC maker, is best known for its build-to-order business model and carrying virtually no inventory. The company has grown from a start-up in founder Michael Dell's college dorm room in 1984 to the world's largest maker of personal computers 21 years later.
HP announced July 11 that.
Mott will also receive 285,000 shares of restricted stock, vesting at 20 percent per year for five years. At Friday's closing price of $24.94, those shares are worth $7.11 million.
"I find that pretty interesting because all he has to do (to) get those is breathe," Spitz said of the restricted stock grant.
IT, sales and services
are among areas to
be hit hard, though
the sweeping cuts will
be felt throughout the
company, a source says.
Mott will also receive "targeted long-term performance cash of $7 million for the 2005-2008 performance cycle, of which $5 million is guaranteed," the filing said.
Mott, 49, will also get relocation benefits that include a relocation allowance of $1 million, the Palo Alto, Calif.-based company said in the filing.
Mott was not listed among the five most highly paid executives in Dell's most recent proxy statement. In Dell's fiscal 2005, the lowest salary earned by the five highest-paid executives was $522,000.
HP also said it agreed to indemnify Mott against "certain claims by his former employer as a result of his employment by HP, and will pay Mr. Mott's reasonable legal fees."