Microsoft Corp (MSFT)
Stock Ownership and Holding Requirements for Microsoft Corporation Executives
Updated: July 1, 2014
The Compensation Committee of the Board of Directors (“Compensation Committee”) believes that Microsoft Corporation (“Company”) executive officers and certain other executives should maintain a material personal financial stake in the Company to promote a long-term perspective in managing the enterprise and to align shareholder and executive interests. The executives who are subject to this policy are the Company's executive officers and other executives who have been designated as participants in the Company's Executive Incentive Program (collectively, "covered officers"). The Compensation Committee has adopted formal stock ownership and holding requirements whereby each covered officer is required to maintain the following minimum equity stake in the Company.
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Microsoft Corporation Corporate Governance Fact Sheet
RoleMinimum ownership Holding requirement

CEO

10x base pay

Each covered officer must retain 50 percent of all net shares (post tax) that vest until the minimum share ownership requirement is achieved.

If the covered officer is promoted to a position that has a higher ownership requirement, the higher standard will apply as of the promotion date and 50 percent of net vested shares should be retained until such time that the ownership requirement is met.

COO and covered officers who lead a product or services engineering function

5x base pay

Other Covered Officers

3x base pay

 
Minimum share ownership levels will be determined annually using covered officer base pay multiples, base pay rate as of the end of the fiscal year (June 30), and the average daily closing share price of the 12 months ending on June 30. For a new covered officer, the minimum share ownership levels will be determined using the base pay rate effective at the time the individual becomes a covered officer and the average daily closing share price for the most recently completed fiscal year. Compliance with the ownership level requirements will be assessed (a) on the date an individual first becomes a covered officer, and (b) annually for all covered officers as of the end of the fiscal year. Once the minimum ownership threshold is achieved, sufficient shares must be retained by the covered officer to meet the minimum share ownership requirement continuously throughout the year. Covered officers will be notified about their ownership requirement, current holdings, and whether additional shares must be held.
 
 
For the purposes of determining ownership levels, the following forms of equity interests in the Company count toward the stock ownership requirement:
Shares held outright by the covered officer, whether acquired through open market purchase, vesting of stock awards, stock option exercise, or purchase through the Employee Stock Purchase Plan.
Shares held by the spouse or dependent children of the covered officer.
Shares held in trust for the economic benefit of the covered officer, or the spouse or dependent children of the covered officer.
Shares held in a 401(k) plan.
Exceptions to these share ownership and holding requirements may be made at the discretion of the Compensation Committee if compliance would create severe hardship or prevent a covered officer from complying with a court order e.g., as part of a divorce settlement.
 
Effective July 1, 2014