“He could have had any job he wanted. Or he could have stayed at Apple, where he was sitting on $50 million of restricted stock — and, should the company continue its record of innovation, untold millions more in the future,” Jennifer Reingold reports for Fortune.
“But instead, Ron Johnson, senior vice president and creator of Apple’s retail stores strategy, is taking the CEO job at J.C. Penney (JCP), a middle-class, middling-performance department store chain — and paying for the privilege of doing so,” Reingold reports. “Why? In part, it’s because Johnson, who started his career at Mervyn’s (later bought by Target (TGT)) and moved up the ranks there before leaving for Apple in 2000, has always dreamed of running a retail company.”
Reingold reports, “But there’s another reason, too… If the stock doubles from today to $60, he’ll earn over $385 million — in addition to the huge sums he would gain on his restricted stock and other pay. What’s more, because the warrants are an investment rather than compensation, Johnson will be eligible for capital gains tax treatment instead of the ordinary income tax rate. And Johnson is already ahead — J.C. Penney shares shot up 17.5% on Tuesday to $35.37.”
Read more in the full article here.