Callouts & quotes from 408+ activist slides

"However, in reality, Defendants conduct their business by way of a massive pyramid scheme: once prospective Associates pay the required $100 application fee to join Defendants and are approved, one of the Associates' primary duties is to recruit more Associates for the benefit of the Defendants – a duty for which they receive no compensation. — Recent Lawsuit Allegations"

"urges the Company to set and disclose individual caps on its short-term incentive plan so as to assure shareholders that executive pay will always be constrained by stated limits. — Glass Lewis; runs contrary to best practices and shareholder interests, as management may receive excessive compensation that is not strictly tied to Company Performance. — Glass Lewis"

"Considering that Zillow's Adj. EBITDA is virtually all stock-based compensation, Spruce Point believes free cash flow is a much better figure to value the Company. Zillow trades at a much higher multiple of free cash flow then nearly all its peers. At over 6x sales and ~37x+ FCF, we believe that Zillow is one of the most richly valued stocks among its peer group."

"The Compensation Committee, with the assistance of Ferguson Partners, determined that "adjusted funds from operations," or "AFFO" would be the most appropriate metric to gauge management's effective operation of the Company's business as a REIT. As a result, for 2023, the Annual Incentive Plan allocation to the Company's AFFO per diluted share was 50%. — CTO 10-K"

"“Herbalife’s entire business model appears to incentivize primarily the payment of compensation that is ‘facially unrelated to the sale of product to the ultimate users’ because it is paid based on the suggested retail price of the amount ordered [from Herbalife], rather than based on actual sales to consumers.” — Federal Court in California (Herbalife v. Ford)"

"“Herbalife’s entire business model appears to incentivize primarily the payment of compensation that is ‘facially unrelated to the sale of product to the ultimate users’ because it is paid based on the suggested retail price of the amount ordered [from Herbalife], rather than based on actual sales to consumers.” — Federal Court in California, Herbalife v. Ford"

"We are not surprised to see a significant decline of insider ownership since the IPO. We have found management’s interests are aligned with its compensation and achieving performance targets rather than long-term, sustained share price appreciation. PBH’s “private equity” like acquisition strategy appears built for an exit and not long-term sustained growth."

"The Compensation Committee and/or the Chief Executive Officer also retain the right to exclude extraordinary charges or other special circumstances in determining whether the objectives were met during any particular fiscal year and may decide to grant 100% of the targeted cash bonus award, even if the financial targets do not fall within the specified range"

"The Committee took this information into account in determining the compensation package that was ultimately provided to T. Andrew Smith upon his appointment as Chief Executive Officer, but did not use the information to benchmark any element of his compensation. — April 30th, 2014 (Proxy): Compensation Committee discussion on Andy Smith Employment Agreement"

"For modeling purposes, we expect capital expenditures, excluding capitalized software of approximately $5 million to $8 million and share-based compensation expense of approximately $70 million for the full year. Fully diluted shares by the end of the year are expected to be in the range of 200 million to 205 million shares.. — PowerSchool 2021-2022 Guidance"

"Lagomasino oversaw consecutive years of problematic compensation decisions, resulting in significant shareholder opposition, which the committee [that she chaired] failed to promptly address. ISS also noted that “Lagomasino bears more responsibility than any other serving nominee for the failure ... to cultivate a readily apparent successor to Iger.” — ISS"

"“Herbalife’s entire business model appears to incentivize primarily the payment of compensation that is ‘facially unrelated to the sale of the product to the ultimate users because it is paid based on the suggested retail price of the amount ordered from [HLF], rather than based on actual sales to consumers.’” — District Judge Gary A. Feess"

"“For 2012, the compensation committee used Adjusted EBITDA as the sole performance metric under the annual and long-term incentive compensation programs because it believes that Adjusted EBITDA provides a simple and understandable measure of our recurring profitability and it is highly correlated to our stock price performance” — 2012 Proxy"

"Moreover, we find that the compensation provided by Elliott to their nominees is consistent and comparable to that of the company's continuing directors; specifically, continuing directors have similar upside potential on historical share grants received during their tenure as directors. — David H. Batchelder, Relational Investors LLC"

"With that considered, we have made the decision to issue an off-cycle RSU grant to partially top up total compensation, particularly for those in the most competitive job categories. We will also reprice a small portion of the total outstanding stock options, those that are far out of the money. — CFO Comments Q2'22 Earnings Call"

""The thresholds were revised by the Human Resources and Compensation Committee in the context of its annual executive compensation review conducted at the beginning of each fiscal year to take into account, among other elements, the fact that the base for the calculation is growing every year." — FY15 Management Proxy Circular"

"Not all percentages are created equal. The illustrative example below demonstrates why the top 1% of Herbalife’s distributors generate 88% of Recruiting Rewards, and why Herbalife’s compensation plan incentivizes distributors to recruit dramatically more so than other MLMs (there is a greater reward if you can get to the top)"

"Based upon Herbalife's own internal documents, Herbalife does not calculate China Sales Employees (a/k/a China royalties) based upon "Hourly Consulting Fees." Instead, Herbalife calculates royalty compensation in China as percentages of Retail Sales . . . just as Herbalife calculates royalty overrides in the rest of the world"

"You will also see in our compensation discussion and analysis in our annual circular that in 2018 management is now compensated on cash flow in addition to revenue and EBITDA. And that'll be a friendly reminder to everyone on the leadership team to pay attention to that. — Maxar CEO Lance Q4'17 Conference Call (Feb 2018)"

"Two of the incumbent nominees oversaw the substantial value destruction that we believe occurred at BOTH Red Lobster and Smokey Bones, and three were on the Compensation Committee that, as described later, put into place an incentive structure we believe that encouraged excessive spending as the answer to every problem"

"Two of the incumbent nominees oversaw the substantial value destruction that we believe occurred at BOTH Red Lobster and Smokey Bones, and three were on the Compensation Committee that, as described later, put into place an incentive structure we believe that encouraged excessive spending as the answer to every problem"

"The Company defines adjusted earnings as net earnings excluding the impact of specified items affecting comparability, including, where applicable, non-operational income and expenses, amortization of acquisition related intangible assets, share-based compensation, and other gains or losses. — Maxar 2017 annual results"

"As we discussed in our investor presentation, we believe this poor capital allocation was the direct result of poor corporate governance at the Board level, including shareholder-unfriendly compensation practices that incentivized management to pursue growth at the expense of returns on capital and shareholder value."

"Optically, PGNY would like investors to believe that it is achieving significant operating leverage. In reality, the largest contributor to its operating leverage story has been its aggressive use of stock-based compensation (SBC). Netting out the benefit of SBC uncovers that PGNY’s EBITDA margins are in decline."

"This survey data supports the thesis that if compensation cooperation requirements were eliminated and home-buyers had to compensate their agents directly, a significant population of home-buyers would try to negotiate commissions, seek agents with lower fees, or even try to purchase a home without an agent."

"Herbalife's entire business model appears to incentivize primarily the payment of compensation that is ‘facially unrelated to the sale of the product to the ultimate users because it is paid based on the suggested retail price of the amount ordered from [HLF], rather than based on actual sales to consumers.’"

"Although NICE is larger than Verint on most metrics (revenue, EBITDA, EBIT) and more efficient (revenue per employee, EBIT per employee), average compensation per insider at Verint is over 3x that at NICE, and Verint insiders take home a far greater percentage of EBIT in compensation than do NICE insiders."

"Poor Controls over Equity Grants: That the board did not become aware until several years after the fact that multiple grants to the CEO were in violation of the Company's incentive plans indicates that it did not have adequate controls in place to monitor the Company's executive compensation practices."

"There are still several current directors and members of management who oversaw and approved some of Disney’s worst corporate governance and strategic failures, including overpaying for the Fox acquisition, the expanding streaming losses, and “over-the-top” compensation packages granted to Bob Iger"

"BR management has consistently touted Closed Sales as a key performance indicator (KPI), and it influences management's short-term cash compensation. But as we'll illustrate, it is fraught with holes and should not be relied upon as a firm measure of revenue that will materialize in the near-term."

"Low compensation levels as indicated by Carvana’s filings is confirmed by employee reviews posted online: it appears that management is trying to attract talent without offering attractive compensation by creating a “fun” startup-like culture and hiring young people with low salary expectations."

"Management has collected ~$35 million dollars in performance compensation, growing at an 11% CAGR vs. organic growth CAGR of ~1%, tied to revenue and EBITDA targets while PBH has missed organic growth estimates for 4 out of 5 years and missed FCF guidance in 3 out of 5 years between 2015 – 2019."

"Mr. Smith’s reported compensation far surpasses that of the highest-paid CEOs last year at much larger companies and is about 20 times the median pay for an S&P 500 chief, according to a Wall Street Journal analysis. Axon is too small to be in the S&P 500 index — Spruce Point Capital Management"

"Seemingly unlike iRhythm’s Board, we do not believe the same management team that resided over a systematically flawed quality and compliance system should receive extra incentive compensation just to remediate their shortcomings, obey basic medical device laws, and cease endangering patients."

"ISS continues to have concerns with the Compensation Committee's decision to approve bonus payments at 110 percent of target when the company failed to achieve the minimum performance goals for operating income before depreciation and amortization and free cash flow. — RiskMetrics Group (ISS)"

""Based on consideration of the criteria discussed above and the overall financial and operational success of the Company in 2017, the Compensation Committee made the decision to provide a salary merit increase, ranging from 4% to 14.9%, to the Named Executive Officers" — Weis Proxy Statement"

"With Sumner Redstone Absent for the Last Few Years, and With Dauman Effectively in Control of his Trust, it’s Been a Perfect Setup for Dauman and Dooley to Keep Paying Themselves Enormous Cash Compensation at the Expense of Shareholders With Weak Accountability in Terms of Their Performance"

"In August 2022, Zillow positioned the higher stock-based compensation as a one-time/off-cycle “retention action”. However, we believe Zillow has few options but to continue to grow stock-based compensation as it now makes up a significant piece of its employee compensation structure."

"It seems to us as if the Compensation Committee (having no Fortress Directors) waited until after the resignation of the Fortress Directors to disclose that it did not use any of information the compensation consultant provided to benchmark Andy Smith’s compensation as incoming CEO"

"This has resulted in executive compensation at AOL that is approximately 3.4 times the median compensation of an appropriate peer group that fits within the guidelines recommended by both ISS and Glass Lewis, despite poor absolute and relative stock price and financial performance."

"In 2023, Chevron’s Management Compensation Committee (MCC) reduced Hearne’s compensation “as a consequence of cost and schedule slippage on major capital project in Kazakhstan, capex overrun in the Permian Basin, and safety performance.” — Chevron Corporation Definitive Proxy"

"In 2023, Chevron's Management Compensation Committee (MCC) reduced Hearne's compensation "as a consequence of cost and schedule slippage on major capital project in Kazakhstan, capex overrun in the Permian Basin, and safety performance." — Chevron Corporation Definitive Proxy"

"Noncash charges associated with [Riot's 2024] onetime grant of approximately $25 million per quarter will drop to approximately $8 million in Q3 2026 and thereafter roll off entirely, significantly reducing noncash stock-based compensation. — Jason Chung, Riot's incoming CFO"

"One former Eurofins U.S. hiring manager – we assume that the U.S. would have the highest compensation expense per employee – stated that Eurofins’ compensation was in “probably like the lowest 5% [for the industry]. It was frankly embarrassing.” — Conversation with Source L."

"As Chair of the Compensation committee for each of the last 3 years, Glass Lewis has recommended that shareholders vote AGAINST Ms. Evans' continued service on the Board of Office Depot and has questioned whether she should even serve on any other public company board."

"Shareholders question operating controls as recent executive compensation leaves more questions than answers: [R]ecent disclosure indicates the CEO was erroneously overpaid and the error led to a $10MM cash bonus in 2014. — Jonathan Bock, Wells Fargo Research 11/5/2015"

"BLK voting actions imply that it is in the best interest of their clients for a company to not pursue compensation for damages against former executives sentenced to jail (at the time of voting, on first degree judgement) for false accounting and market manipulation"

"BLK voting actions imply that it is in the best interest of their clients for a company to not pursue compensation for damages against former executives sentenced to jail (at the time of voting, on first degree judgement) for false accounting and market manipulation"

"In light of corporate performance for the quarter ended January 31, 2019, the Compensation Committee exercised its discretion to adjust the payouts for our named executive officers down to approximately 70% of their bonus targets. — Box FY2019 Executive Bonus Plan"

"In light of corporate performance for the quarter ended January 31, 2019, the Compensation Committee exercised its discretion to adjust the payouts for our named executive officers down to approximately 70% of their bonus targets. — Box FY2019 Executive Bonus Plan"

"We calculate that 35-50% of Adjusted Operating Income (EBIT) has gone to IRBT’s executive management in the past two years, whereas it was only 15% in 2011. We view this as a warning sign of executive compensation becoming disconnected from operating performance."

"We take issue with numerous governance decisions currently in effect at Zillow. One of our biggest concerns is that Zillow has not established a formal incentive program that outlines financial targets or thresholds that play a role in management’s compensation."

"It is concerning that Limbach removed working capital targets from its incentive compensation plan targets after 2020, particularly given the Company's use of cost-to-cost accounting, where revenue and profit recognition are heavily tied to management estimates."

""If [HMA] does not meet or exceed the Quality Requirement, the [Compensation] Committee will exercise its discretion to reduce the portion of the Adjusted EBITDA-Modified Performance Components that is eligible to vest and be paid by up to 20%." — HMA Form 10-Q"

"Vivendi opportunistically used the 19 member cap in TIM's by-laws to allow its executives onto the Board, although a majority of other investors voted against this as well as objecting to using TIM's funds to pay for compensation for these additional directors"

""We consider a long-term DCF model to represent the most appropriate valuation method for ATHN shares." — Morgan Stanley, p.11; "Of note, we have subtracted from our DCF analysis stock based compensation to account for equity dilution." — Morgan Stanley, p. 4"

"The 2009 actual expense for “China Sales Employees” (a/k/a “China Royalty Overrides”) of $79,082,000 matches the $79.1 million Herbalife later reported as its 2009 “compensation to China sales employees and service fees to China licensed business providers.”"

"None of our executive officers served as a member of the compensation committee of another company, or as a director of another company, whose executive officers also served on our compensation committee or as one of our directors. — HPE 2017 Proxy Statement"

"“The Company does not utilize an objective, formula-based approach to setting long-term executive compensation levels. Rather, the compensation committee determines equity grant amounts on a purely discretionary basis.” — Glass Lewis 2011 AOL Proxy Paper"

""it is possible that some of our activities, such as stock-option compensation paid to physicians or our practice of loaning equipment to customers at no additional cost, could be subject to challenge under one or more of such laws." — Procept 2023 10-K"