New HP chief exec gained stock, options worth $90 million

Financial terms of the deal were not disclosed.

Under the deal, application service provider (ASP) USi said it will work with Conklin to sell Lawson's business management software to mid-sized business customers. From its data centers, USi will host and manage the software that helps automate a company's human resources, financial, and supply chain needs.

Lance Conklin will be president and general manager of the USi Lawson business unit. USi will retain Conklin's facilities in Milford, Connecticut. With 65 employees, Conklin provides consulting and integration services to 150 Lawson customers.

Outsourcing advocates argue that hosting is a sensible route for small or mid-sized businesses that want to use business software but can't afford to hire staff to manage it. The ASP market is expected to grow to $2 billion by 2003, according to market research firm International Data Corporation.

Recently, a growing number of business software companies have inked deals with hosting partners to offer outsourcing as an alternative to mid-sized companies, many who have been reluctant to invest in ERP software.

Business software maker SAP has already partnered with services giant EDS, telecommunications firm Qwest Communications International, and start-up eOnline. Meanwhile, Oracle rents its software through Oracle Business Online and rival PeopleSoft partners with Corio and USinternetworking.

USi competes in the emerging ASP space against companies including Corio and Breakaway Solutions.

Hewlett-Packard chief executive Carleton Fiorina got restricted stock and options worth as much as $90 million for signing on to lead the high-profile computer maker, the company said.

Fiorina's pay package also calls for a $1 million annual salary and a yearly bonus of $1.25 million to $3.75 million, according to a quarterly report filed with the Securities and Exchange Commission. In addition, she will receive a one-time signing bonus of $3 million, minus any annual bonus she gets from her former employer, Lucent Technologies, during HP's current fiscal year.

"It's a very competitive salary package," said Marlene Somsak, HP spokeswoman. "It's largely equity-based, replacing the value of options and stock she left behind at Lucent, and we believe the options align with shareholder interests."

The 45-year-old executive, known as Carly, became one of three women to run a Fortune 500 company when she was hired in July as president and chief executive. She succeeded Lewis Platt, who will remain chairman of HP until he retires December 31.

HP's Somsak said the company estimates that options and restricted stock, representing a total of about 1.18 million shares vesting over the three to four years, "will be valued at between $80 million to $90 million."

The new chief executive's stock package includes 290,000 restricted shares and 290,000 restricted units. The HP spokeswoman said that both types of securities vest over three years. She said that restricted units are largely the same thing as restricted shares, but have some tax advantages.

Fiorina was granted options to buy 600,000 HP shares at the fair market value of the stock as of her July 17 hiring. Those options currently aren't worth anything, because HP shares have fallen 8.7 percent since mid-July.

The chief executive will get a pro-rated bonus of about $360,000 for part of the 1999 fiscal year that ends October 31, and is guaranteed a minimum bonus of $1.25 million for the company's fiscal 2000.

As a group president at Lucent, Fiorina handled about $20 billion in annual sales of equipment to phone companies.

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