Casual Male Retail Group Getting Creative With Employee Compensaion

(and you wonder where they stole that Casual Male XL idea from)

I thought this 8-K filing by Casual Male Retail Group (CMRG) was pretty interesting - focus on the bolded sentence:

(e) On January 29, 2009, Casual Male Retail Group, Inc. (the “Company”), pursuant to Board approval, repurchased certain stock options with exercise prices significantly in excess of market price from certain directors and executive officers, including David A. Levin, its President and Chief Executive Officer, and Dennis R. Hernreich, its Executive Vice President, Chief Financial Officer, Chief Operating Officer and Treasurer. Such repurchases were made pursuant to separate Option Repurchase Agreements with each of the individuals. The Company repurchased and cancelled the eligible options in exchange for cash payments equal to the fair value of the applicable options on the date of repurchase, as determined using Black-Scholes. The Black-Scholes value of each option repurchased was calculated based upon the closing stock price of the Company’s common stock on January 29, 2009.

The Company repurchased options with underlying shares totaling 2,291,512 for an aggregate purchase price of $7,191.73. These options had exercise prices ranging from $4.54 to $12.35 per share. Of the 2,291,512 shares underlying the repurchased and cancelled options, options covering 1,206,854 shares issued under the Company’s 2006 Incentive Compensation Plan (the “2006 Plan”) were repurchased and, pursuant to the terms of the 2006 Plan, will become available for future issuance under the 2006 Plan. In connection with the repurchase and cancellation of these options, the Company will recognize additional stock compensation expense of approximately $1.5 million in the fourth quarter of fiscal 2008 relating to the acceleration of vesting associated with the options.

The Company believes that this action enhances long-term stockholder value by improving the Company’s ability to incentivize and retain its employees, as well as reducing the Company’s equity award “overhang” (that is, the number of shares subject to outstanding equity awards relative to the total number of shares of common stock outstanding) through the cancellation of outstanding options that currently provide no meaningful retention or incentive value to the Company’s employees.

This is nothing but pure cronyism. All management is doing is tossing out their old options so they get newer, cheaper ones at lower prices. The least they could do is refuse to accept any cash for these worthless, out-of-the-money ones.

But the real funny part is that the company believes that "this action enhances long-term stockholder value by improving the Company’s ability to incentivize and retain its employees."

Think about that for a second.

We are in an awful recession! It has never been EASIER to retain employees, especially in retail. It's not like Macy's (M) or Liz Claiborne (LIZ) are hiring!

Casual Male should be CUTTING the pay of its big shots. After all, the company is expected to lose money over the next two years, and like I said, with the economy in the toilet, employee retention isn't a problem for anyone these days.

*****************

Like What You're Reading? Click Here to Subcribe To Our RSS Feed!

6 Versions of Windows 7 = 6 More Reasons Not to Like Microsoft

WTF? Back in my days working for TheStreet.com (TSCM), I once wrote (subscription required) that Microsoft (MSFT) was pretty darn crazy to release so many versions of its Windows Vista operating system:

Right now, Microsoft is well on the road to creating confusion with Vista, as it's offering three consumer versions of the upcoming operating system, Home Premium, Home Basic and Ultimate. Microsoft made a similar error with the Xbox 360 (a mistake that Sony (SNE - commentary - Cramer's Take) is quite foolishly copying with the PlayStation 3) by creating two different versions of the gaming console.

And now I'm reading that Microsoft is upping the ante, cranking up no less than six versions of its upcoming Windows 7 operating system. Here is Gizmodo's breakdown:

Windows 7 Starter is for emerging markets mostly, but also for some netbooks as an option. It's pretty gimpy, and only runs three apps at a time, though it'll have the new taskbar, Device Stage and jump list. Since Home Premium (and even the Ultimate beta) runs pretty well on netbooks, most of them are probably going to stick with that, so don't worry too much about it.

Windows 7 Home Basic is for developing markets only, and Microsoft didn't even tell me anything about it, so forget about it. [This info was added in an update.]

Windows 7 Home Premium is the standard consumer offering of the OS with Aero Peek, Media Center and all the other cool features we've been talking about, and what most people will be running, whether they're on a desktop or a netbook. It's better at media than Vista Home Premium, since it ships with DVD playback and codecs like DivX out of the box. In case you're wondering why Microsoft kept the "Premium" tack-on despite the extinction of Basic—it's because in market testing, Vista users thought they were getting downgraded, going from Vista Home Premium to Windows 7 Home.

Windows 7 Professional has everything that Home Premium does, but with business and "enthusiast" features like file encryption, location-aware printing and advanced backup.

Windows 7 Enterprise is for businesses buying OS licenses in bulk, so you probably won't have to worry about it (unless you're paid to). It's got everything Professional does, but with a few additions like BitLocker full-disk encryption and direct access capability, so you don't have go through a VPN for remote access.

Windows 7 Ultimate is, as you might have guessed, the ultimate version of Windows. Unlike Vista, where it was the combo of Home and Business with a couple added features, this time, it's like the end user version of Enterprise—in other words, the Enterprise version that regular people can buy. It has BitLocker, notably, and a few other advanced features. It seems like visibility of this will be low, outside of a few "special promotions" from vendors occasionally, to minimize confusion.

WTF Microsoft? Why can't you just make three versions? One for home, one for business, and one for emerging markets. With so many versions of Windows 7, you are giving the impression that you are shortchanging those that can only afford cheaper computers.

One of the reasons Apple (AAPL) is doing so well is because it makes the selection process extremely simple. It's hard enough for a non-techie consumer to choose from the half-dozen or so major PC manufacturers out there, and now they have to choose from five different versions of Windows 7?

We all want to be Ultimate!

***************

Like What You're Reading? Click Here to Subcribe To Our RSS Feed!