Sirius XM (SIRI) has just granted General Counsel Patrick Donnelly another $5 million worth in various stock awards. In the following video, Fool contributor Tim Beyers says that while it sounds rich, it's actually a pretty good arrangement for Sirius investors.
How can we be so sure about Donnelly's deal? Tim cites two SEC filings that describe the nature of the agreement: a Form 4 that describes the specifics of what the Sirius vet is getting, as well as an accompanying 8-K that includes Donnelly's employment agreement.
According to the Form 4, Donnelly acquired another 270,270 shares on Jan. 10. Trouble is, you need the 8-K to understand the whole story. It turns out the shares are connected to a $1 million restricted stock grant. No cash changed hands in the transaction.
Donnelly also received 3.67 million in options to purchase shares at $3.70 each, presuming he's still with the company when they vest in equal amounts over the next three years. Tim says the layers of detail help explain why it's so important for investors to get to know the SEC's EDGAR database and learn how to read insider transactions reports.
And what of Donnelly? Is he worth the price Sirius is paying? Tim answers that question in the video so please watch now, and then leave a comment to let us know whether you would buy, sell, or short Sirius XM stock at current prices.
