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Barksdale returns stock
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April 16, 1998: 8:28 p.m. ET
Netscape chief gives up option grant of 300,000 shares
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NEW YORK (CNNfn) - Netscape Communications Corp. President and Chief Executive Officer James Barksdale elected to return an option grant of 300,000 shares earlier this month, according to a proxy filing submitted the Securities and Exchange Commission Thursday.
The move comes after Barksdale had already reduced his annual salary to $1 in 1997 from $100,000 the year before to show his commitment to bolstering the company's performance. He also said he will take only $1 this year as well.
The options, granted in April 1997, had a strike price of $27.50 a share and were due to expire in 2007. Netscape shares closed Thursday at 25-9/16, making the options worthless, although like most Internet stocks, the company's shares have been on a tear in recent days. (Click here to see a 12-month graph of Netscape stock)
Based on Netscape's proxy filing, the options could have been worth just over $13 million, assuming Netscape shares rose an average of 10 percent annually over the next 10 years.
Netscape (NSCP) shares rose 5-13/16, or 29 percent, Thursday after rumors again surfaced that Sun Microsystems Inc. might be interested in buying the company. However, other market insiders said speculation the company was near a deal for a partnership on its NetCenter Internet directory was behind the move.
NetCenter represents Netscape's effort to better capitalize on the fact that its browsers come pre-configured to go to Netscape's home page on start-up. Earlier this year, Netscape renamed its home page NetCenter and broadened its content in hopes of making it a viable competitor to Yahoo! and other Internet search engines.
The rumors that Sun, or others, could be out to buy the company first surfaced early this year when Netscape announced it was cutting 400 jobs, its first-ever layoffs.
Following that decision, Netscape also decided to begin giving away its browser free in hopes of stemming market share loss to Microsoft Corp.'s Internet Explorer. Microsoft already made its browser available for free.
Netscape also has said it will make the source code, or programming instructions, freely available for developers to modify. However, Netscape must approve any modifications done to a browser before another company can sell it.
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Netcenter
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