HP recently filed its Offer Letter between Hewlett-Packard Company and Margaret (Meg) C. Whitman. Unlike previous CEOs, such as Carly Fiorina (Base Salary of $1,000,000), Mark Hurd (Base Salary of $1,400,000), and Leo Apotheker (Base Salary of $1,200,000), Meg has an initial base salary of only $1 per year. However, she will be eligible for a target bonus of $2,400,000, so this is not an entirely pro bono affair.
HP has an executive stock ownership guideline that requires to CEO to hold HP shares with a value of five times salary. However, with a initial base salary of $1 per year, this requirement would be meaningless. For Meg, her “guideline will be based on a notional base salary of $1,200,000 instead of [her] actual salary of $1.”