Wednesday 11 June 2014

CQ- Zuckerberg and other directors drag to court over pay plan

Mark Zuckerberg and other members of Facebook  board have been sued by a shareholder who claimed a policy letting them annually award directors more than $150 million of stock each if they choose is unreasonably generous.
In a complaint filed on 6th June in Delaware Chancery Court, Ernesto Espinoza said the board was “essentially free to grant itself whatever amount of compensation it chooses” under the social media company’s 2012 equity incentive plan, which also covers employees, officers and consultants.
He said the plan annually caps total awards at 25 million shares and individual awards at 2.5 million, and in theory lets the board annually award directors $156 million in stock each. The lawsuit does not contend that such large sums will be awarded.
Espinoza also said last year's average $461,000 payout to non-employee directors was too high, being 43% larger than typical payouts at "peer" companies such as Amazon.com Inc and Walt Disney Co that on average generated twice as much revenue and three times more profit.
Facebook spokeswoman Genevieve Grdina commenting on the issue told media that "The lawsuit is without merit and we will defend ourselves vigorously."
Among the other defendants is Facebook Chief Operating Officer Sheryl Sandberg, a director whose compensation was $16.15 million in 2013.
Source: http://cablequest.org/news/international-news/item/5177-cq-zuckerberg-and-other-directors-drag-to-court-over-pay-plan.html
Source: http://cablequest.org/news/international-news/item/5177-cq-zuckerberg-and-other-directors-drag-to-court-over-pay-plan.html

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