The Lesser of Two Evils
Could it be back to the future where employees are willing to work for stock options? Thirty-six percent of the workforce at Acxiom® Corporation voluntarily participated in a unique cost-saving operation -- pay cuts in exchange for stock options -- thereby hoping to prevent future layoffs.In an effort to prevent future layoffs and maintain company longevity, 36 percent of the employees at Acxiom® Corporation voluntarily participated in a unique cost-saving operation -- pay cuts in exchange for stock options.
The fact that Acxiom has been one of Fortune's 100 Best Places to Work three of the last four years is evidenced by the eagerness in which employees have embraced this program. Michelle Smith, an Acxiom associate who elected to take the additional pay cut, said, "I have talked to many friends at Acxiom, and we all have the same feelings. We are happy to be here, we are happy to be working for a company that believes in its associates, and we are happy to be working for a company that sticks together when times get tough."
The Little Rock, Ark.-based company, a provider of global real-time, multi-channel customer data integration solutions, announced today that the aggressive combination of payroll cuts, bonus eliminations and other payroll and benefit expense controls are expected to reduce expense levels by $20 million to $30 million in 2002.
"When an Acxiom associate voluntarily says, 'Cut my pay and give me a stake in the company's future,' that is the ultimate vote of confidence from the very people who best know this company, its customers, and its products," Acxiom company leader Charles D. Morgan said. "The enthusiastic acceptance of this program by Acxiom associates means we will exceed even the original $30 million reduction estimate, and our overall goal of reducing more than $70 million from the current fiscal year budget is very achievable."
Also, by an April 11 deadline, 5,533 associates were given the option of an additional pay cut of up to 15 percent in exchange for a 2-for-1 match in stock options. The strike price of those options was set at $13.325, the market value of the stock on April 11, 2001.
Options in the program will become fully vested on April 1, 2002 and share dilution is an estimated 2.5 percent. Some associates are exempt from the mandatory 5 percent pay cuts, including those who make less than $25,000 a year and non-U.S. associates, but they were eligible to participate in the voluntary program.
Acxiom Corporation's array of solutions include customer data integration software, database management services, and premier customer data content through its AbiliTec(TM), Solvitur® and InfoBase® products