Michael Hartleib believes that the management of Sirius XM has been unjustly enriching itself at the expense of its shareholders.
This raises the question: "Who is Michael Hartleib?" Other than the fact that he's the subject in the lead sentence above, I can't find that he "is" anybody whose name most of us should recognize.
Still, he has taken two actions worthy of note in this place. He has created a group called SaveSirius with the idea of waging a proxy fight, and he has filed a derivatives lawsuit in a federal court in California.
SaveSirius has sent formal letters of demand to the SIRIUS XM directors. It demands, specifically:
* postponement of the vote that is seeking shareholder approval to further dilute the common stock by increasing the number of shares in the fully diluted float from 4.5 billion to 8 billion.
* postponement of the proposed reverse split, ranging from 1 for 10 to 1 for 50.
* immediate suspension of all stock compensation plans and other bonuses.
Showing posts with label incentive bonuses. Show all posts
Showing posts with label incentive bonuses. Show all posts
Monday, November 17, 2008
Tuesday, March 25, 2008
Motorola
Motorola has scheduled its annual meeting for May 5. There might be a lot of fireworks between now and then, because Carl Icahn, no less, wants four seats on their board -- one-third of the total.
Motorola has offered him two seats. Icahn isn't in the mood for compromise and has turned that down.
Aside from the vote on who sits where, the meeting will also include a resolution to recoup unearned management bonuses. This looks like a turn-the-heat-up tactic on Icahn's part. The proposed resolution asks the board to seek to "recoup all unearned incentive bonuses or other incentive payments to all senior
executives to the extent that their corresponding performance targets were later
reasonably determined to have not been achieved or resulted from error(s)."
Icahn has also brought a lawsuit for access to documents. Delaware law requires that a demand for inspection have a specific basis -- the investor making such a demand can't be on a fishing expedition. On the basis that this is exactly what Icahn is doing, Motorola will contest the matter.
The stock price, by the way, has fallen dramatically over the last five months, from above $19 to below $10.
That might lead one to suppose, "gee, they must have lots of dissatisfied investors on their hands, so maybe the ground is fertile for Icahn's challenge."
It ain't necessarily so, though. The investors who are the most disgruntled about Motorola's management are those who would have been most likely to sell already -- to sell out at some point between $19 and $10. So those who still had stock as of the record date earlier this month, almost by definition, are those who believe that the problems are short-term and have some faith in a turnaround.
A real shake-out price drop on this scale, in other words, might be good news for a would-be self-entrenching management.
Actually, I have no idea. I'll know when you folks do.
Motorola has offered him two seats. Icahn isn't in the mood for compromise and has turned that down.
Aside from the vote on who sits where, the meeting will also include a resolution to recoup unearned management bonuses. This looks like a turn-the-heat-up tactic on Icahn's part. The proposed resolution asks the board to seek to "recoup all unearned incentive bonuses or other incentive payments to all senior
executives to the extent that their corresponding performance targets were later
reasonably determined to have not been achieved or resulted from error(s)."
Icahn has also brought a lawsuit for access to documents. Delaware law requires that a demand for inspection have a specific basis -- the investor making such a demand can't be on a fishing expedition. On the basis that this is exactly what Icahn is doing, Motorola will contest the matter.
The stock price, by the way, has fallen dramatically over the last five months, from above $19 to below $10.
That might lead one to suppose, "gee, they must have lots of dissatisfied investors on their hands, so maybe the ground is fertile for Icahn's challenge."
It ain't necessarily so, though. The investors who are the most disgruntled about Motorola's management are those who would have been most likely to sell already -- to sell out at some point between $19 and $10. So those who still had stock as of the record date earlier this month, almost by definition, are those who believe that the problems are short-term and have some faith in a turnaround.
A real shake-out price drop on this scale, in other words, might be good news for a would-be self-entrenching management.
Actually, I have no idea. I'll know when you folks do.
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