Bobby Kotick’s tenure at Activision Blizzard has been extended, but the senior CEO’s salary is falling.
Activision Blizzard In a new SEC filing (via Wowhead) it is revealed that the company is taking over as CEO Bobby KotickEmployment.
Kotick’s contract was originally set to expire on December 31, 2021, but has now been extended to March 31, 2023. Kotick, who has served as the company’s chief executive officer for more than 30 years, will receive a 50% base salary cut. And his annual bonus.
Activision Blizzard’s board of directors has decided to do this based on shareholder feedback, to “integrate market best practices” and directly link remuneration to performance. You may remember that some shareholders who had passively viewed Blizzard in the past criticized Kotick’s compensation plan. They believed that even if the employee was fired, his salary was too high.
The board of directors also cancelled two other Kotick awards, namely the “Transformation Transaction Award” and the “Shareholder Value Creation Incentive”. Starting from January 1, 2021, until the contract extension period ends in March 2023, Kotick’s annual salary will be reduced from $1.75 million to $875,000.
However, in the next two years, Kotick may eventually get the same income. The document states that the CEO is eligible for an annual bonus, which may be as high as 200% of his basic (reduced) salary. 80% of the bonus will be based on the company’s financial goals, while 20% is reserved for the “Measurable Environmental, Social and Governance (ESG)” plan for each fiscal year.
Activision Blizzard’s compensation committee will determine the value and the payment method (cash, stock) of the bonus. In short, if he reaches the company’s milestones, he is eligible for another $17.5 million in bonuses each fiscal year.
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