Kwak No-jung, president and CEO of SK hynix (000660.KS), exercised stock options granted as part of performance-based compensation and responsible management, acquiring an additional 2 billion won ($1.5 million) worth of company shares.
SK hynix disclosed Monday that Kwak exercised stock options on Sunday to acquire 2,329 shares of the company. Based on the closing price of 886,000 won per share on the payment date the previous day, the acquisition is valued at approximately 2.06 billion won. The exercise price of the stock options was 138,980 won per share.
The stock option exercise is significant in that it converted performance-linked compensation into actual equity ownership. By personally increasing his stake, Kwak, as CEO, demonstrated his commitment to responsible management aimed at boosting the company's earnings and shareholder value.
With this exercise, Kwak's holdings in SK hynix increased from 6,105 shares to 8,434 shares. The value of his holdings stands at approximately 7.47 billion won. Kwak also received 335 company shares as a bonus in January this year.
Cha Sun-yong, who was appointed as an inside director at last month's annual general meeting, also exercised stock options under the same terms as Kwak, acquiring 2,329 shares of SK hynix. The exercise price was also 138,980 won per share. Cha's total holdings increased to 6,834 shares, valued at approximately 6.05 billion won based on the previous day's closing price.
Executive share purchases are generally interpreted as a signal to the market of confidence in a company's medium- to long-term growth potential and stock price.