According to a Hartford Courant report, the recently distributed non-manager bonuses were as high as $500.
Aetna spokesman Fred Laberge told the Courant that there have been six option grants since 1998, and the average grant has been 50 to 60 options per worker. The number of options was based on salary. The options were valuable; the stock has risen from $34.44 on the first day of trading in the company’s December 2000 spinoff to $124.04 a share at Tuesday’s close. As of December 9, 2004 Aetna workers still held options worth more than $220 million, based on that day’s $123.55 share price.
The company would not estimate what the expense would be if the company continued giving options to workers next year. However, Laberge told the newspaper non-management employees have realized more than $192 million in pretax profits by exercising options granted since 1998.
Last week, Aetna distributed special cash bonuses to more than 21,000 non-management employees who will no longer get new options. The bonus “recognizes the important contributions employees have made to Aetna’s success in completing its turnaround,” Laberge told the paper. Full-timers who were with Aetna the entire year each received a $500 bonus, and those who joined Aetna July 1 or later got $250. Part-timers got half of those amounts.
The Financial Accounting Standards Board (FASB) recently unveiled the stock option expensing rules scheduled to go into effect in June 2005 (See FASB Releases Stock Option Expensing Rule ).