Episode Details

PROXY COUNTDOWN SCRIPT

This is Proxy Countdown. Welcome to the big show for the week of September 16, 2024  alongside my tag team partner Matt Moscardi. I'm Damion Rallis. On today’s countdown:

New Air Jordans at Nike

23andMe reduced to Me

Activist Investor Elliot Management is still not happy with Southwest Airlines

A Pay Committee mutiny at Open Text

And on the Big Vote, Matt lashes out at dinosaur delivery company FedEx

Trade Wire - BUY/SELL

Top Stories:

Nike CEO John Donahoe, who has been Nike’s CEO since 2020, will retire from his position on October 13, and be replaced immediately by company veteran Elliott Hill, who worked at Nike for 32 years before retiring in 2020

Two of the people behind the change are, of course, Nike co-founder Phil Knight and current Chair Mark Parker.

Knight said that he: “couldn’t be more excited to welcome Elliott back to the team” and that “We’ve got a lot of work to do but I’m looking forward to seeing Nike back on its pace.”

Now I point this out to help demonstrate the importance of our influence percentages at freefloatanalytics.com. Co-founder Phil Knight is not even on the Nike board anymore. But his son Travis Knight is, and that’s why we gave him 54% of the board influence, because his father continues to pull strings. Also, the Chair, Mark Parker, has 10% influence, even more than retiring CEO John Donahoe. So as you can see, this was a precarious leadership position for the lame duck CEO, one our influence percentages were already hinting at.

Elliot Hill will receive $3M in equity and $4M in cash to rejoin Nike while Donahoe will be allowed to “resign,” meaning he will receive the full value of all his remaining equity awards.

All of 23andMe’s independent directors resigned from its board this week: Roelof Botha, Patrick Chung, Sandra Hernández, Neal Mohan, Valerie Montgomery Rice, Richard Scheller, and Peter Taylor.

The resignations follow drawn-out negotiations with 23andMe CEO and co-founder Anne Wojcicki, who wants to take the company private.

In a letter addressed to the CEO and now only director, the seven directors said they had yet to receive a “a fully financed, fully diligenced, actionable proposal that is in the best interests of the non-affiliated shareholders” from the CEO after months of efforts.

In response the CEO said in an SEC filing: “I am surprised and disappointed… We will immediately begin identifying independent directors to join the board.”

But that’s sort of the problem in the first place: 23andme is not a “we” but a “she” and I guess now it’s merely a “me”:

The directors also argued that, while they still believed in 23andMe’s mission, their departures were for the best due to Wojcicki’s “concentrated voting power” and a “clear” difference of opinion on the company’s future. 

Anne controls 50% of the voting power due to her ownership of 59% of Class B shares which magically grant her the right to 10 votes per share. The foreshadowing was in the company’s ticker symbol: ME

There are also several egregious bonuses to report on:

At Sarepta Therapeutics, newly appointed director Deirdre Connelly starts with an initial equity grant worth $712,500. She will also receive annual pay of $60,000, meaning that they are handing her 12 years of salary before she has even said anything worthwhile

Lattice Semiconductor announced the appointment of Ford Tamer as CEO and will receive $30M in sign-on awards on top of a $10M target equity aw