This adjustment meant that unlike previous CEOs, Elop was facing
an instant, massive windfall should the following sequence happen
to take place:
- Nokia’s share price drops steeply as the company drifts close to
cash flow crisis under Elop.
- Elop sells the company’s handset unit to Microsoft under
pressure to raise cash.
- The share price rebounds sharply, though remains far below where
it was when Elop joined the company.
Should this unlikely chain of events ever occur, Elop would be
entitled to an accelerated, $25M payoff. Through some strange
coincidence, that very sequence of events actually did happen to
take place between 2011-2013. Practically instantly after Elop was
handed his contract.