PeopleSoft rethinks exec stock options

PeopleSoft has softened on its stance on linking the vesting of executive stock options with the hitting of performance milestones, according to a filing with the Securities and Exchange Commission on Thursday.

The business software maker, in response to a proposal from shareholder CalPers, a large pension fund, agreed its CEO and four of its highest-paid executives would have to meet certain performance milestones in order to vest 50 percent of their stock options in 2005. CalPers then withdrew its proposal, which had called for 75 percent of the options to vest at the same milestones. The proposal had also required that the exercise price of the options be based on an industry index or be set 15 percent higher than the market price at the time they were awarded.