Article:
http://blogs.wsj.com/digits/2013/09/23/microsofts-board-approves-retention-payments/
Referenced:
http://www.forbes.com/sites/annemariesqueo/2013/09/25/microsofts-lack-of-ceo-succession-plan-lesson-for-other-companies/

This article describes the type of compensation that Microsoft is offering to its most talented executives and the reasons why now. Steve Ballmer’s retirement and the name of his replacement still unknown has created an uncomfortable situation inside Micorosoft.The board of directors considers the transition period until a new CEO is elected as a critical one. It is not unusual for companies that go through this process to face some confusion among employees or uncertainty among senior executives of whose approval to get when it comes to important decisions. This is also the time that some of the talented executives loyal to the outgoing CEO and his ideas might decide to leave the company also.
Faced with the possibility of executives upheaval or employees unhappiness Microsoft’s board of directors approved a new type of stock grant. The purpose of stock grant compensations is to keep employees motivated and dedicated to the company. By offering these compensations the company tries to align its priorities with those of the workers and also enhance shareholders value. The company is showing that it is investing in employee’s future and wishes to employ him/her for many years s. The stock grant is usually restricted. The employee is the legal owner of the shares but cannot sell them until the restrictions are lifted, or also known as the time when the shares are vested.
According to SEC in the case of Microsoft filings these stock grants can be used to recognize the exceptional performance of certain executives. They are also known as retention payments. This form of recognition is important in trying to hold on to key and talented managers in the corporation. In the case of Microsoft the COO and the General Counsel were offered stock grants valued at $19.6 million and $15.2 million respectively.