Change to payroll deduction stock plan

As of Oct. 1st any stock that is purchased through the pay roll deduction stock plan will have a 2 year no sell stipulation. Any thoughts on this change.
Good or Bad?

So it just affects us small potato guys and not the big boys who have the stock bonused to them, etc, right.

No surprise there.

It makes all purchasers super suckers if UPS were ever to go the way of all the other multi-national corporations that went belly up due to upper management scandals and criminal corruption because you couldn't get out in time even if you saw it coming some how.

Typical.

Why does everything with you have to be a fight between the little man and the evil corrupt company.

Hopefully you do your homework before making an investment decision. If you think UPS is a good long term investment then the stock purchase plan gives you a nice initial return on your purchase. Its a perk the evil corrupt company is giving you.

If you want a more fluid investment option than buy the stock on the open market and take your chances.

With my plans on purchasing a house next year I had planned on taking a hiatus from the payroll deduction anyways. This change motivated me to jump out sooner. I need somewhat quick access to my money in the next couple years, so I don't feel like waiting 2 years to sell what is mine. I will probably rejoin the plan sometime in the future as you can't deny the benefits of having a 10% discount on stock purchasing. Its just the idea of having to wait 2 years to see that gain that has me a bit annoyed.

Tie,
The contract is up in two years is it not? I may wish to sell my stock but UPS will not let me then. Hmmmmmmmmmmmm.......
PAS will be in full implementation in two years will it not?
The evil company strikes again!

If I buy a stock today, I should have the right to sell it tomorrow.

I have a stupid question – is this for the “discounted” stock purchase plan? Or is this for full price shares?

Racerx,

This is for the discounted 'A' shares purchased. Don't know if it applies to MIP shares, but those really couldn't be sold anyway, if you ever wanted to see them awarded again.

2 years is the price you pay for getting small amounts each week commision free and recieving the 10% discount. I see when you sell you have to pay top rate on the 10% and long term cap. gains on the other 90%.

(Message edited by brownmonster on September 30, 2005)

Tie,
How can you be so naive?
OOPS! I forgot.......you're in management which is an integral part of the "....evil corrupt company".
When/if the rug gets jerked out from under "us", management will get their money and the leftovers (if there are any) will be divided amongst the "little man".
How many hourly do you know that are living in a $250,000 house and sitting on 2 million in stock?

I believe the reason this stipulation was put in place was because too many people were buying and selling immediately to recognize a quick 10% profit. These shares are bought as "A" and become "B" when sold. It is not very different than other employee stock plans at other companies. Same with the MIP. We still can get 1/2 in cash but most hold the rest for 5 years. "Golden handcuffs" as they are referred to. Susie, we can still sell older MIP shares and does not affect your future MIP participation. I, as well as many other people I know have sold shares. We are encouraged not to, but especially if you are above the "ownership guideslines" no one can stop you.
Clever/speed, you can still buy UPS shares without the discount and sell them at any time. Personally, UPS is a good stock to hold in your portfolio, but you want to be diversified. I like Cramer and have made alot using his stock picks.

I withdrew from payroll deduction several years ago and rolled all my A shares to B shares for many reasons but one reason was to be able to react quicker in case there was a problem. UPS does have a history of good business practices that promotes being a safe investment but history is just that. It's history and doesn't guarantee the future so even though the 10% reduction is a good deal this 2 year window forbidding selling IMO is just not worth the risk.

I'm also not confident in UPS management right now nor in the nearterm future. We are stuck on chasing numbers rather than servicing customers and building relationships that promote good business growth. How can we plan for the future when we have no relationship with the customer to understand their present and future and thus we aren't in a position to capitalize of their needs? Drivers are first link in this process and aren't being used effectively IMHO in this regard.

So far since it's public offering UPS stock hasn't gained and maintained longterm momentum. It'll will jump up ahead of itself from time to time only to fall back and there are some opportunities of buying and selling on the open market to capitalize on the up and downswings to make a little money and over time use the gains to add more stock that in the payroll deduction would never happen. I believe the 10% reduction doesn't present a good enough opportunity to overshadow buying and selling on the trends of this stock. The ugly truth no one dare speak is that even FedEx in the same timespan UPS has been public has really been from an investors point of view a much much better buy and yes I bought some of that too!

JMO

“How many hourly do you know that are living in a $250,000 house and sitting on 2 million in stock?”

Hate to break the news to you, trickpony…….. But most of the management that you are describing here are pretty far up the food chain – Director level and higher. Not many in middle management live like that. I know I don’t. So who do you consider “management”? Any supervisor or manager? IF the “rug gets jerked out” from beneath “us”, those supervisors and managers will be hurting a lot more than you think. So much of managements’ compensation is in stock. So if the stock price stays strong, we are in good shape. BUT, if the stock price tanks, management (and any investors in UPS) are the ones that will get hurt in the long run.

air_upser:
Susie, we can still sell older MIP shares and does not affect your future MIP participation. I, as well as many other people I know have sold shares. We are encouraged not to, but especially if you are above the "ownership guideslines" no one can stop you.

I suppose the key phrase would be 'older MIP shares'. I would assume that those are perhaps even more than two years old, correct?

"Tie,
How can you be so naive?
OOPS! I forgot.......you're in management which is an integral part of the "....evil corrupt company".
When/if the rug gets jerked out from under "us", management will get their money and the leftovers (if there are any) will be divided amongst the "little man".
How many hourly do you know that are living in a $250,000 house and sitting on 2 million in stock?"

Trick pony that has to be the dumbest line of argument you have come up with yet. How do you think managers get their two million dollars of stock? its not from being given that stock. And its definitely not from selling it early. They buy, they hypo to buy more and they sit on it for years without selling. If a driver wants to take the risk of putting his stock up as collatoral and buying more they too could possibly be a millionaire by the time they retire. And yes I do know people drivers and inside full timers that turned their thrift plan money into a lot of money.

Again all of you have the right to buy and sell stock on the open market without waiting. If you want the 10 percent discount then you have to sit on the stock for two years. I believe this follows federal tax guidelines for employee stock discount programs.

tie, please don't attempt to put words in my mouth.

I have never called the company evil, nor corrupt and there is little fight involved.

You see when it amounts to the company decides and the employees abides or quits it wouldn't really be called a fight.

The commission free payroll deduction offer was a nice one.

If they are handcuffing it to a two year locked in requirement like a CD, then they have lessened the value of it period.

Air, as your payroll deductions are held for quarterly purchases it would hardly be considered immediate buy and sell, but I see your point and I can see a restriction of months or inability to repurchase more for a specific duration of time if you exceed a UPS specified churning rate, but two years is ridiculous.

According to many managers here we are likely to go out of business from fred and duh way sooner than that!

Any stock held before Oct. 1st can be sold as you please. Only the stock purchased after Oct. 1st has the two year stipulation.
It is also my understanding that the company put a two year restriction on the management stock bonuses last year.

Actually 5 years before management has it to sell. similar to an options plan.

"According to many managers here we are likely to go out of business from fred and duh way sooner than that!"

Ok is there anyone out your way that has a positive outlook on UPS. Chew on this point as you consider your investment options:

first quarter this year Fedex grew by app. 300,000 packages a day. UPS about 45,000

second quarter of this year about even around 250,000 a day for each of each.

third quarter - UPS app 400,000 a day , fdx app. 120,000 a day.

we are turning the tide on fdx. Many rumors of big wins in our part of the region.

Is there anyone on this board from the New Stanton area? I'm hearing the BD folks in the newpa area are close to taking fdx's biggest customer?

$250,000 house? Not that big of a deal these days. Many drivers with house worth that and this is the midwest.

"Ok is there anyone out your way that has a positive outlook on UPS."

tie, yup.

ME.

Course, you were probably talking about management.
They pretty much tote the company line of doom and despair if the hourly doesn't sacrifice their first born, etc.

I agree with you, I see us doing ok against fred, but we have to stop this service bleeding that is going on where the primary objective seems to be numbers rather than service.

For a while now it has been much more important to make sure our missed are trackable than to eliminate the missed.

The PAS nightmares I read about on this board seem to accent that philosophy as well.

That will lose us business to competition, not because competition is better, but because we are worse than the competition.

That is why I have always said if we take care of business the competition is just a thorn in our side rather than a stake in our heart.

The "Evil Company" HAS struck again.

Someone allowed Mellon to NOT buy the stock for the last quarter before the Oct. 1 deadline. I just checked my account again and the last quarter purchase is still not there. Today is Oct. 4.
This alone has tied up a bunch more money.
My question is this: WHY is UPS suddenly clamping down on the stock?
The only logical reason that I can deduct is to stop as much stock selling going into the contract period as they can.
If the employees began to sell off in large amounts prior to the immediate end of the contract, then logic dictates that the stock price would go down.
JMHO!

(Message edited by wornoutupser on October 04, 2005)

Sell now!!! (You can buy it all back at a huge discount in 2008).

I just got a letter from my finance company. My house is mortgaged at 1 mil +++. And my new payment is 8 grand, interest only........and it is 2 months late.
Seems they added a 1 accidently somehow.
I told them if they couldnt figure out what happened, just send me the other million, and I will take care of it.
In the meantime, I wont be making my house payment of eight thousand dollars.....
They dont know what went wrong, my loan was sold and they dont have all the info yet
BTW, it is 700 sq feet, cottage on a lake, with no utilities til I moved in in 2000. Guess property value is reaaaallyy goin up!!!

(Message edited by toonertoo on October 04, 2005)

WORNOUT... the contract goes till July 31, 2008. I think the co did not want it in 2007 because that will be 100 years since the great Jim Casey found the company. It would not look good for Eskew to be standing on the floor of the NYSE to ring the opening bell while 200,000++ of UPS employee's are walking the picket line.