Sometimes wealth is good

[Reggie Bautista]

We usually only hear about the bad things that big companies
do. Here's an article about my employer, Hallmark Cards, Inc,
that shows a big company doing something good.

http://www.kansascity.com/mld/kansascity/business/4416148.htm

Excerpt:
Before the end of the year, Hallmark will convert
employees' stock to preferred and guarantee a rate
of return for that stock, a return tied to interest
rates with a built-in premium. Hallmark employees
currently own 22 percent of the company's stock,
with the rest owned by the Hall family.

The Hall family has agreed to convert the stock at
the higher of two prices, either the price at the
beginning of 2002 or the end of 2002. That essentially
guarantees that employees won't see the value of their
Hallmark stock drop for 2002.

It's estimated that the conversion at the higher price
will diminish the value of the common stock owned by
the Hall family by $90 million to $100 million.

...

Referring to the conversion at the higher price, Bower
[Bruce Bower, president of Wealth Management Advisors
in Overland Park] said: "Some were suspicious, but
there's always a degree of suspicion when you dink with
somebody's money. But this is hugely generous, and
certainly something you wouldn't see in the public
world."

So the Hall family is basically taking a $90 million hit
so that employees won't lose any money this year in their
profit sharing accounts. (And this comes as Hallmark is
trying to reduce headcount by attrition and lots of employees
are hitting retirement age.) I'm hugely proud to be part
of a company that cares enough about it's employees to do
something like this. (On the other hand, it makes me
wonder, if they can afford that kind of hit, just how much
money does the Hall family have, anyway? :-) But at any rate,
we hear so much bad news about the behavior of big companies,
I thought I'd pass along this bit of good news.

Reggie Bautista
GSV Thankful for what I have


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