cosmo: Re: Do you really expect someone to do the stressful job of a CEO for peanuts (relatively speaking of course)?
Peanuts? Wow. I don't know what reality *you* live in, but last I checked, in my reality, a quarter of a million dollars could buy a *lot* of peanuts. That reminds me of what the late Sen. Everett Dirksen once said: "a billion here, a billion there, and pretty soon you're talking real money." LOL!
There are three classes of wage earners:
1) Those who get paid for what they *do*. We call these blue collar.
2) Those who get paid for what thet *know*. We call these white collar.
3) Those who get paid what they themselves decide, which is usually as much as they think they can get away with. There are two subcatagories in this catagory: Corporate officers, and members of Congress.
The average middle manager in my company makes $100,000+ a year. Much more for director, VPs, etc.
Of course, that varies from company to company. My company, which is among the top 200 fastest growing small businesses in the country, the president and CEO take a salary of $125,000 each. However, they, as well as all other employees, are compensated by a very lucrative profit-sharing program, and both are quite wealthy. Just because some company officers get obscene salaries does not mean that all are *entitled* to get them.
It is very unrealistic for anyone to take a pay cut in any industry where they are not required to. Why should NVEI be any different - is it just because we are shareholders of this company?
You can bet you last red cent that if this were a privately held company, and assuming that they actually *intend* to be successful, the officers would be drawing practically nothing in the way of salary in order to pay the bills. This great country is built on a foundation of great men who struggled in the beginning. However, for some reason, publicly traded companies, especially on the OTC, tend to have officers who think that they are entitled huge salaries, even though they have done *nothing* to deserve them. They do it because they *can*. Shareholders can do little unless they get very organized and vote the scoundrels out.
I don't think that most shareholders realize how close this company is to bankruptcy. In any given month, it is entirely possible that they will not be able to sell enough shares, even at steep discounts, to pay all of their bills. We are literally teetering on the edge of disaster, and out illustrious leaders are raking in the dough. Is it legal for them to do this? You bet. Just remember, though, that the *only* commodity that NVEI currently has is credibility, and not much of that. Their credibility among shareholders is critical to the survival of the company. It is the only thing keeping the shareprice up. However, as you are well aware, shareholders are losing confidence, and rightfully so. The company has lost a great deal of credibility because of a long string of broken promises and missed deadlines. If just a few of the larger shareholders bail, the price could plummet, and there goes their ability to pay bills. Next stop, chapter 11.
I have always maintained that the company officers should be leaders and they should lead by example. They make bold statements about the great things to come for the company, yet they do not demonstrate their own belief in their own statements by accepting shares in lieu of salary, or deferring portions of salaries altogether until funding is received. When not backed up by actions, their words of encouragement have a very hollow ring to them.
...the New York Rangers hockey team should restructure his contract next year because of his poor play this past year. Lindros is scheduled to make $9,000,000 next year.
This is a poor example. Lindros got the big contract because he was one of the very best players in the business. In other words, he *earned* it. He clearly demonstrated his ability to succeed. The Rangers paid him the big salary because they had the revenue to do so. I don't know who the owner of the Rangers is, but my guess is that the front office did not make the deal with Lindros without the owner's agreement. Do you see where I'm going here? The NVEI senior managers have demonstrated nothing. There is not record of any of them successfully bring a semiconductor company to market, let alone any record of them being the best in the industry, yet they take high salaries. The company has no revenue to support those high salaries, and furthermore, the company owners (shareholders) did not apporve the deal.
But that sort of thing just doesn't make sense. Especially since their salaries are very reasonable compared to others in the industry. In fact it already is lower to start off with.
I think that you should do a little bit of reasearch before making this kind of statement. Do a search on CEO and COB salaries for all of the companies in the country with zero revenue over the last 5 years, less than 50 employees, a debt-to-equity ratio in the hundreds, a book value of about 5 million, and a few thousand in cash. I'll bet that you don't find Brad to be in the low range for salary in that catagory.
I suspect that you are trying tocompare his salary to that of CEOs for semiconductor companies. This is an incorrect comparison. NVIE is *not* a semiconductor company. In order to be a semi company, you actually have to make semiconductors. Until NVEI has a product, they are a wannabe. You can't compare the salaries of wannabes to the rest of the industry.
Someone like Brad could argue that he is already on a 'reduced' salary...
LOL. Good one.
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