BlackBerry is throwing millions at new CEO

John Chen will receive a bumper payout as he tries to help the smartphone maker regain its footing.

By MSN Money Partner Nov 8, 2013 4:42PM

Credit: © 2013 Research In Motion Limited
Caption: BlackBerry Bold 9900By Reuters


BlackBerry (BBRY) will pay its new interim CEO a base salary of $1 million, a bonus of up to twice that amount as well as stock awards potentially worth some $85 million, in the hopes of turning around Canada's most prominent technology company.


John Chen, the second consecutive chief executive officer at BlackBerry to receive a bumper package, will have to help the embattled smartphone maker regain its footing and win back market share ceded to the likes of Apple's (AAPL) iPhone and a range of devices that run on Google's (GOOG) Android operating system.


Chen was credited with turning around Sybase in the late 1990s. Sybase, an enterprise software company, was eventually acquired by SAP (SAP) in 2010.


Chen's share awards only begin to vest after he completes three years with BlackBerry, and the majority of the options will vest only after he completes his fifth year, according to a regulatory filing late on Thursday.


Should Chen be fired without cause, he will be paid up to $6 million, according to the filing.

Chen's appointment came after BlackBerry stunned many on Monday when it abandoned plans to sell itself and instead opted to raise funds via a $1 billion notes offering led by Fairfax, its largest shareholder.


Fairfax, led by investment guru Prem Watsa, had said it was investing $250 million in the offering.


In its filing on Thursday, BlackBerry said Canso Investment Counsel is investing $300 million in the offering, while Mackenzie Financial, Markel Corp., Qatar Holding, and Brookfield Asset Management are buying the remainder.


As part of the financing deal, BlackBerry has agreed to pay a fee to the investors if it does reach an alternate deal that results in the sale of the company, either before, or within 30 days of the close of this deal.


Depending on the circumstances, the fee could range between $135 million and $250 million.

The investors have also pledged to a standstill agreement, for a period of one year, that restricts them from owning more than 19.9 percent of the company's outstanding shares, a move likely aimed at preventing any creeping takeover of BlackBerry.


Thorsten Heins, who is forced to step down as BlackBerry's CEO as one of the terms attached to the financing deal, could also be set to receive millions in severance after two years in the job. The exact amount will depend on the terms settled with the company.


More from Reuters

2Comments
Nov 11, 2013 7:21AM
avatar

Thanks for confirming what we already knew, BlackBerry's prices are much to high

Nov 10, 2013 7:32PM
avatar
The finale corrupt pay out before lights out....If you are still invested, you have probably lost so much you don't give a damn.....yuk yuk
Report
Please help us to maintain a healthy and vibrant community by reporting any illegal or inappropriate behavior. If you believe a message violates theCode of Conductplease use this form to notify the moderators. They will investigate your report and take appropriate action. If necessary, they report all illegal activity to the proper authorities.
Categories
100 character limit
Are you sure you want to delete this comment?

DATA PROVIDERS

Copyright © 2014 Microsoft. All rights reserved.

Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.

STOCK SCOUTER

StockScouter rates stocks from 1 to 10, with 10 being the best, using a system of advanced mathematics to determine a stock's expected risk and return. Ratings are displayed on a bell curve, meaning there will be fewer ratings of 1 and 10 and far more of 4 through 7.

116
116 rated 1
265
265 rated 2
429
429 rated 3
612
612 rated 4
499
499 rated 5
525
525 rated 6
701
701 rated 7
533
533 rated 8
337
337 rated 9
131
131 rated 10
12345678910

Top Picks

SYMBOLNAMERATING
UPLULTRA PETROLEUM Corp10
COPCONOCOPHILLIPS9
TAT&T Inc9
DVNDEVON ENERGY CORPORATION9
EOGEOG RESOURCES Inc9
More

VIDEO ON MSN MONEY

ABOUT

Top Stocks provides analysis about the most noteworthy stocks in the market each day, combining some of the best content from around the MSN Money site and the rest of the Web.

Contributors include professional investors and journalists affiliated with MSN Money.

Follow us on Twitter @topstocksmsn.