Travelport, which is moving ahead with plans for its initial public offering, is getting all its ducks in a row by approving equity awards, cash bonuses and new employment contracts for top management.
Five members of management -- President and CEO Jeff Clarke, CFO Philip Emery, Travelport Deputy CEO and Travelport GDS CEO Gordon Wilson, GTA President and CEO Kenneth Esterow, and General Counsel Eric Bock -- all got new employment agreements, which become effective upon completion of the IPO.
Interestingly, the contracts for Clarke, Bock and Esterow have initial terms of 18 months and they provide severance packages if they choose not to renew the employment contracts. That, of course, hinges on them being "good leavers," i.e. if they are not terminated for cause.
Could this be setting the stage for their departures in a post-IPO transition? New investors will want these guys around for a period to ensure some stability. I guess all options would still remain open, but the trio might be incented to depart because they would be subject to "additional equity acceleration" if they opt to leave after 18 months.
Details of the lengths of the employment agreements for Deputy CEO Wilson and CFO Emery were not revealed, but will probably be disclosed when Travelport files its annual report for 2009.
Does this mean Wilson will move up in the ranks and perhaps Emery will stick around, too,?
Meanwhile, apparently for a job well done, Travelport granted special bonuses to management that go beyond equity giveaways approved as part of an IPO Awards program.
The cash bonuses, subject to the completion of the IPO, add up like this: Clarke ($1,492,312); Wilson ($703,311); Emery ($172,200); Esterow ($379,831); and Bock ($304,994).
In addition, subject to the completion of the IPO, they all would be receiving restricted equity units in the following amounts: Clarke (3,543,307 REUs); Wilson (1,459,709 REUs;) Emery (832,035 REUs); Esterow, (885,827 REUs); and Bock (841,535 REUs).
Somehow, I bet the favored five all are rooting for a successful IPO.