Long-Term Incentive Plan Cancellations & Regulatory Battles
Cancel Culture
Welcome to this week's news brief.
Nearly a dozen companies in the Russell 3000 have?canceled long-term incentive plans?since the beginning of 2022.
Most notably, this year, the popular video game platform?Roblox?replaced a seven-year mega-stock grant — recently valued at $525.8 million — with an annual equity award worth $25 million for its CEO,?David Baszucki. The original package was granted before the company went public in 2021. Since then, it hasn't come close to hitting lofty stock-price targets, and Baszucki has received less than $4 million, mostly in perks, filings show.
Most LTI plans are canceled when outside forces drive financial projections off track. Sources told Agenda that when a board determines an equity plan must be canceled, it's best to get input from management on the adjustment process. That way, everyone feels like they're rowing in the same direction.
Going Shopping
The?5th Circuit Court of Appeals?is examining several of?SEC?Chair?Gary Gensler's regulatory priorities as?critics have flocked to the conservative district?with complaints. "Litigants will always choose the forum that will most likely favor their client," one source told Agenda. "Everyone forum shops."
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