BlackBerry was once at the top of the smartphone market but has since lost its spotlight on center stage. Although there have been some tough times over the past few years, things are looking up for the handset maker. Today, Executive Chairman and CEO John Chen has agreed to remain at his post through 2023.
"The BlackBerry Board of Directors has tremendous confidence in John Chen. John engineered a successful turnaround and has the company repositioned to apply its strengths and assets to the Enterprise of Things, an emerging category with massive potential," stated Lead Director Prem Watsa.
Chen has been working at BlackBerry since 2013 and has overseen the difficult process of transitioning from primarily a hardware business to focusing on embedded software and cyber security. Going forward, BlackBerry will further push into Internet of Things and automotive applications.
BlackBerry's own company description now reads that it "is a cybersecurity software and services company dedicated to securing the Enterprise of Things."
With the contract renewal comes the opportunity for Chen to collect up to 10 million restricted share units as well as cash awards. A greater number of shares will be awarded at whole dollar amounts if and when BlackBerry's stock price reaches $16 to $20. Cash rewards are payable should BlackBerry's stock reach $30 per share. For the entire compensation package to be received, BlackBerry must increase its market capitalization by 134 percent over the next five years.
The CEO's base pay will remain at $1 million annually with an expected $2 million bonus. The total value of the contract is worth approximately $128 million based on March 14 stock prices. Full details of Chen's compensation package will be made public in May 2018 before the June shareholder meeting.
For those interested, BlackBerry will likely continue to sell its smartphones as long as they remain profitable. However, all manufacturing is contracted instead of being done in house.