The new policy gives Blockbuster shareholders the ability to advise the Board on whether the annual compensation for the company's top executives, including Chairman and Chief Executive Officer James Keyes and Chief Financial Officer Thomas Casey, should be ratified.
The company said that the advisory vote, commonly referred to as a "say on pay" provision, will be submitted to its shareholders each year at its annual shareholders meeting.
Slightly more than half the votes cast at the company's 2007 annual meeting supported the new provision, Blockbuster stated.
"Holding this advisory vote on executive compensation on an annual basis will not only improve dialogue with our shareholder base, it will also provide our Board with valuable feedback on our compensation policies, which currently link both bonus and equity compensation to Blockbuster's financial and operating performance," said Keyes.
According to the company, the adoption of "say on pay" is the latest step taken by the Board to promote director accountability. Last year, the Board proposed to eliminate the classification of the Board of Directors so that all directors would be subject to an annual election. The shareholders approved this proposal.
BBI closed Monday's trade at $3.55, up $0.25, on a volume of 6.29 million shares. BBI.B rose $0.14 and closed yesterday's trade at $2.82, on a volume of 528,500 shares.
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