Douggie Cashes Out

Ardenian

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Jun 27, 2006
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PHL crewroom -
Can anyone confirm the authenticity of this letter that came across my computer today?

If it is accurate, Doug is over $12M heavier today! That certainly shows how confident he is of our future, eh USA320?

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A Letter from Doug Parker to All Employees


Dear Fellow Employee:

I wanted you to know that I have decided to exercise and sell some of my US Airways stock options. I have told you that I will always be open and honest with you about how I'm compensated, and while this isn't new compensation, it is the first time I've exercised options in my eleven years with America West/US Airways, and I thought I should explain it to you.

The fact is that I've authorized the exercise of options to acquire 272,250 shares of US Airways stock and the sale of those shares. All of these options were granted to me during my time at America West. A small portion (24,750) of these options were granted almost ten years ago and are about to expire, which means that if they aren't exercised, they simply go away.

That, along with feeling I should diversify my stock holdings, is the primary reason that I have chosen to exercise some options now. You should also know that after these options are exercised, I do not plan on exercising any other options this year.

Please do not take my option exercise as an indication that I believe US Airways is "topping out". To the contrary, I think we are just getting started. The people of US Airways have a lot more to show our competitors and our customers, and as we do, I believe the value of our company will continue to increase. These 272,250 options represent less than 20% of the equity I have been granted and less than 40% of my fully vested, in-the-money equity grants. Furthermore, you should not interpret anything significant from my decision to exercise options at the prices prevailing this week. My transactions are being handled through something called a Rule 10b(5)-1 plan, which means that I decided weeks ago to exercise these options beginning on August 1, and I created a plan that said I would. I can't change that plan just because the stock price fell a few dollars last week, so the shares are being sold at the current market prices.

Lastly, please understand that while these stock option exercises/sales will result in some meaningful cash payments to me, no cash comes from US Airways. These options were all granted to me over the past ten years and gave me the right to purchase the then AWA stock at the exact price that it was selling for that day. They only have value because the stock is worth more today than when the options were granted, and the cash comes from the buyers of the stock at today's higher market prices. While many of our competitors (including the old US Airways) filed bankruptcy over the past ten years, wiping out the value of all equity and creating significant turmoil for their employees, AWA was able to avoid such a fate, which was in all of our constituents' best interest. I am hopeful that equity grants in the new US Airways will have a similar increase in value over the coming years, because that would mean we have all done our job to build an airline that can survive and thrive even in difficult times.

So there you have it -- this is a big deal to me since it marks the first time in eleven years that I have exercised options and sold stock that is part of my total compensation. I wanted you to hear from me firsthand why I am doing this and how these transactions work.

Thank you,

Doug
 
I don't see the problem. He's cashing out some options that are about to expire...
What would you or anybody else do? No Virginia, sorry but there's no conspiracy.
 
24,750 are expiring...what about the extra 247,500? Not that he shouldn't be able to make a little $$$...why so much?
That's the way stocks work if you're smart- buy low and sell high. He bought low then he worked very hard, personally, to increase the value. Now he reaps the reward and sells high. What should he do, tell a buyer he is selling below market value to limit his profit? He earned it...
Good job Doug. :up:
 
I agreee .it's no big deal. Every executive in every industry does this. Of course when I saw the letter I knew there would be people on this board that would make a big issue out of it.
 
You guys make me laugh.

rih, the only one so far making a big deal out of this is me. Obviously the posters above are all from the West and haven't realized a concession if it hit them square in the head. You will get what you expect.

The guy cashed in and will make $12 million on a merger that is not complete and has no intentions of any transitional agreement provisions for labor being enhanced...unless you guys swap some monetary provision to give to your counter part on the west and vice a versa.

Honesty..yea, wonderful to know that he's up front to tell all the workers he is now a multi-millionaire and more deserving of the options he was bestowed then you. East labor was not permitted to choose stock options once the merger was announced, which was in all the ratified provisions on the East.

So, now that the east profit sharing for labor has been totally diluted because YOUR CEO did not want to provide to the WEST some of the profits sharing and basically said to the East labor groups, "either you share your pie, or West gets nothing.

Ah, just got to love you all...blind trust is the only way to keep on truck'en in the airline business.

BTW, a320av8r, the CEO didn't purchase any stock, they handed it to him.

Someone please ask him who is paying the income tax on these shares since they were aloted by the corporation...

Let me guess, USAirways. Just like the others.
 
That's the way stocks work if you're smart- buy low and sell high. He bought low then he worked very hard, personally, to increase the value.


He bought low??? How shrewd!

I guess we could all be such market geniuses if we were granted options to buy wayyyy below market.

Ok today I exercise my option to buy a $50 stock at $6, then sell immediately without ever having to open my wallet. Look out Warren Buffet!

BTW, I don't begrudge him exercising his options.

I do have a problem with the apologists and cultists spinning though. IMHO he is a bit less than honest when he states he did this so he could exercise them before they expire, it appears only a small amount were actually close to expiring.

He didn't "buy low" and hold with his own money.

But hey, good for him. I'm sure the $12 million or so will help him diversfy his portfolio a bit better.
 
I am sure he has no problem putting gas in his dozen cars to come to work. :down:

I have a real hard time taking a position that any exec at USAirways should have some god-given entitlement of becoming instant millionaires when that opportunity came from the HUGE CONCESSIONS, furloughs and pension dumps from the employees.

ITS BEEN LESS THAN ONE YEAR AND THE MERGER HAS NOT BEEN CONSUMATED, AND THE FOLKS ON THE WEST HAVE AMENDABLE CONTRACTS THAT HE WON'T FAIRLY NEGOTIATE AND THE EAST ARE RIDDLED WITH SEVERE CONCESSIONS UNTIL 2012. What the heck, at least he's telling that he is now a multi-millionaire instead of you finding out from the obvious SEC report HE MUST submit to the shareholders.

They are despicable organisms.

Well the primary difference here is two fold.

One he informed the workforce and that is very different from other CEO's at US Airways. Can you see Wolfe even dreaming he owed employees an explanation.

He presented a valid explanation for his decision and pointed out where the money cam from. You can also make the argument that just like the employees getting a profit sharing, DP got paid too.

Now you can debate the fairness of the dollar amounts but it is what it is.

Bob,

The employees didn't get any money. That will only be triggered if the net annual profit is realized at the end of the year. The best time to sell his stock, including the 250,000 shares that WAS NOT expiring until 2012, was NOW.

Please spare me the "good guy" nonsense.
 
Eleven years sure is a long time to wait for the big payoff.

I can't wait to see the payoff the rest of us get in pensions after 30 years.
 
Its his stock, he can do what he wants with it.

Or maybe you all think he should just sell it and distribute it to all the never ending professional victims here?

Guess what? Only one CEO at the company, and this is part of his contract, you can whine and moan, or go and become the CEO of a large company if you feel slighted.

Jeez, its his stock, at least he is commuicating what he is doing.
 
You guys make me laugh.

rih, the only one so far making a big deal out of this is me. Obviously the posters above are all from the West and haven't realized a concession if it hit them square in the head. You will get what you expect.

The guy cashed in and will make $12 million on a merger that is not complete and has no intentions of any transitional agreement provisions for labor being enhanced...unless you guys swap some monetary provision to give to your counter part on the west and vice a versa.

Honesty..yea, wonderful to know that he's up front to tell all the workers he is now a multi-millionaire and more deserving of the options he was bestowed then you. East labor was not permitted to choose stock options once the merger was announced, which was in all the ratified provisions on the East.

So, now that the east profit sharing for labor has been totally diluted because YOUR CEO did not want to provide to the WEST some of the profits sharing and basically said to the East labor groups, "either you share your pie, or West gets nothing.

Ah, just got to love you all...blind trust is the only way to keep on truck'en in the airline business.

BTW, a320av8r, the CEO didn't purchase any stock, they handed it to him.

Someone please ask him who is paying the income tax on these shares since they were aloted by the coroporation...

Let me guess, USAirways. Just like the others.

Pitbull,

Agree. 100%. Thanks for the honesty, DP. My stomach just turned. Let's just try to remember this when we are being asked to come up with a "COST NEUTRAL" contract in the near future. Cost neutral= concessions, on both sides. We are talking work rules etc, NOT just cash.... Heads up, everyone!!!!! :down:
 
Its his stock, he can do what he wants with it.

Or maybe you all think he should just sell it and distribute it to all the never ending professional victims here?

Jeez, its his stock, at least he is commuicating what he is doing.

Some people complain about injustice, some people complain about greed. Some people are so smug and self-satisfied they can only complain about others having something to complain about.
 
These are monies he EARNED prior to the merger. For him to leave that money on the table would be foolish.

Now if he took monies from current options earned post merger that would be cause for alarm.
If everyone were honest for second NONE of us would leave even $500 on the table if we had options that were old and/or expring.

Bob,

Read the SEC report. AFA MEC is on this like flies on sh%%.

The only shares that were going to expire was 10% of what he actually sold. The rest comes from the new distribution.

The East ratified contract provision 2005 provided for stock mind you....it was taken away during BK because the investors said none of labor could have stock...but of course the Execs, or they would not invest.

So Dougie gets to become an instant millionaire in less than a year out of BK, because Labor once again had to please the investors who too called the shots in BK. Without our conceding, there would be no investment, there would be no merger, and there would be no Dougie millionaire, none of the Execs.

I would bet Jerry G got stock options too and is cashing in. You won't read about him because as a union busting "consultant", he doesn't have to report to the SEC; not even his salary...
 
Some people complain about injustice, some people complain about greed. Some people are so smug and self-satisfied they can only complain about others having something to complain about.


Injustice and greed? Get real. You sound like a broken cliche'.