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Business

DaimlerChrysler Executives Cash In

A number of top executives at German-US auto giant DaimlerChrysler are cashing in on the recent sharp rise in the company's share price sparked by the announcement that chairman Jürgen Schrempp is stepping down at the end of this year, it emerged on Thursday. According to mandatory legal filings published on the automaker's Web site, six managers have exercised options to buy DaimlerChrysler shares at a discounted price and then immediately re-sold those shares at a much higher market price on the same day, reaping fat profits from the transactions. Since Schrempp announced last week that he planned to step down three years ahead of the expiration of his contract, DaimlerChrysler shares have risen by more than 10 percent on the stock exchange. Two board members, Thomas Sidlik and Eckhard Cordes, and four other top executives, Harald Böstler, Herbert Kauffmann, Ulrich Walker, Wolfgang Diez and Günter Egle, all liquidated their holdings since the announcement, netting a total 1.26 million euros ($1.56 million), according to DaimlerChrysler's own information. On top of that, the managers received additional cash payments to make up for differences between the reference price and the actual strike price of the options, DaimlerChrysler said. All in all, the managers took home more than 1.5 million euros in profits from the deals. The transactions were criticized by shareholder groups, who argued that the variable components of managers' wages should not be linked to the share price but to a company's long-term profits.

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