Gregory J. Hayes, the chief financial officer of United Technologies Corp., was certainly the company's highest paid employee on Monday.
In the course of business Monday, he exercised options for 267,000 shares of UTC stock. Options are a right to buy a stock at a set price even after the market price rises.
By the end of Monday, Hayes sold the same number of shares and was $14.1 million richer, minus whatever taxes he owes.
Exactly why Hayes cashed out about a third of his stock options is unclear. UTC declined to comment on the transaction, which was reported Wednesday in a filing to the U.S. Securities and Exchange Commission.
Hayes, who has been CFO since 2008, still had a few years left to exercise the options, which were issued in groups that would expire in 2015, 2016 and 2019, at prices ranging from $51.50 to $57.84. Executives are often restricted by windows for when they can exercise their option rights, though it's not clear whether that applied in this case.
A significant sale of stock could be a signal that a company executive believes the stock has reached a high point. Shares of UTC closed Monday at $109.70, a good showing for the stock, which crossed the $100 mark in mid-July.
Had Hayes held the shares until Wednesday, when the stock closed at $111.01 — on new highs following news the U.S. Federal Reserve would keep making its bond and treasury purchases — he could have made an extra $384,500.
Year-to-date, the company's stock price has jumped 35.4 percent.
As of March 1, Hayes held options to buy 795,400 shares of UTC stock, of which 484,400 were vested. On Monday, he bought 267,000 shares for $14.8 million. They had a market value of $28.9 million. He immediately sold the shares at the market value, making $14.1 million.
Hayes could not be reached for comment for this story.
Copyright © 2013, The Hartford Courant
Kid- I got it from Joe Marinara, a really reliable sauce, that Hayes is related to Gordon (Greed is Good) Gecko