General Electric (GE) cancelled stock awards for Chief Executive Officer Larry Culp originally valued at USD 20 million, saying the company had failed to reach minimum performance thresholds necessary for the executive to take full title to the shares, The Wall Street Journal reported.
The move, made by the board last month, wiped out USD 5 million of the USD 8.2 million in total compensation the company reported for Culp for 2022, as well as a tranche of shares originally valued at USD 15 million when it was awarded in 2020, WSJ said. The company also cancelled equity awards for the same years for other top executives.
Had the company not cancelled the stock awards, the two batches of shares for Culp would have been valued at about USD 14.4 million at the end of 2022, WSJ said.
Culp still could receive a tranche of performance-linked shares awarded in 2020 in connection with a two-year extension of his employment agreement into 2024.
WSJ said GE already had reduced the amount of stock Culp could receive for 2022 after shareholders voiced their objections to terms of his 2020 contract extension. Instead of a USD 15 million target stock award laid out under that agreement, GE said a year ago that his target would be $5 million. That is one of the awards cancelled last month.
GE valued those shares at about USD 146 million at the end of 2022, up from USD 57 million originally, on the assumption that Culp receives the maximum number of shares possible under the terms of the award, according to WSJ. So far, he has earned about a third less than the maximum, a company spokeswoman said. The number he ultimately receives depends on the company's highest average share price over any 30 consecutive trading days through mid-August 2024.
The pay disclosures were made in the company's annual proxy statement, filed with the Securities and Exchange Commission on Thursday. (ANI)