As described in the case, Warren Buffett met with and had a steak dinner with Jeffrey Immelt: (a)advised him to stay away from tying compensation to stock price, and (b) basing the new program on simple targets. As described on page 12 of the case beginning in the second paragraph Immelts new package was announced.

1)Identify and briefly describe each element of this NEW package, specifically dealing with elements other than annual incentives or base salary (FOCUS ON EQUITY, LONG-TERM INCENTIVES IN PARTICULAR).

2)For each element of this NEW compensation package as identified in 1) above, comment briefly on whether each element is consistent with Buffetts advice (a) and (b) items above as cited previously (see previous page-in quotes). WHY? WHY NOT?

3)In your opinion, is Buffett correct? Why? Why not?