Three weeks ago, audio specialist Skullcandy (NASDAQ:SKUL) hired itself a new chief executive officer, 37-year-old former Nike + Digital Sport general manager Hoby Darling. At the time, the company advised investors that it intends to pay Darling $450,000 in annual salary, a sizable annual cash bonus, and $2 million worth of stock options and restricted stock units.
On Friday, the company clarified exactly what "$2 million worth" means.
In a filing with the SEC, Skullcandy advised that its compensation committee has decided to award Darling 310,679 restricted stock units, or RSUs, and also 150,943 stock options. Thus, in total Skullcandy is giving Darling, should he so desire, the right to take control of 461,622 Skullcandy shares without buying a single share on the open market. That amounts to approximately 1.7% of shares outstanding.
Not all of these shares become Darling's immediately, however. Rather, both RSUs and options will vest in four equal lots, annually over the next four years. The options will be exercisable at a $5.15 strike price. (Skullcandy shares already sell for $5.38).
Skullcandy shares gained 2.7% in Friday trading to close at $5.38.