In its proxy statement, the company said Fiorina had declined to accept her retention payment of US$8 million and Capellas had also declined his of US$14.4 million. The proxy statement added that the compensation packages for the top executives would be figured out after the merger was completed.
Lucrative compensation
Hewlett's report clearly suggests two things: the seemingly generous concessions by Fiorina and Capellas were made because only because both knew very lucrative pay packages awaited if the deal was completed, and Hewlett-Packard decided not to disclose the compensation packages under consideration to avoid further criticism of a controversial merger.
But Hewlett-Packard insists such reasoning is erroneous. According to Larry W. Sonsini, outside counsel to the company, the figures in Hewlett's report were preliminary numbers, which were rejected as probably too high and not the result of a rigorous methodology. "The prior discussions were aborted," Sonsini said. "The prior discussions were not a benchmark for what the compensation will be, and the prior discussions were confidential."
"It's unfortunate that Walter has decided to do this now," said Sonsini, a partner in the firm, Wilson Sonsini Goodrich and Rosati.
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