Seeking Alpha

Plantiffs challenge Cheniere's defense of stock grants

  • Cheniere Energy (NYSEMKT:LNG) investors who are filing suit say the company can’t use stock exchange rules to justify $1.86B in stock grants they claim were never legally approved by shareholders.
  • The shareholders have told a Delaware judge that LNG didn’t meet the legal requirements to approve grants that made CEO Charif Souki last year's highest-paid CEO and put other top execs on a par with CEOs at companies such as American Express, Coca-Cola and Pfizer.
  • The company had argued earlier it followed NYSE rules in tallying shareholder votes from 2013 which nearly tripled executive and employee stock awards in its long-term compensation plan; the investors say exchange rules aren’t considered law and can’t be used to override Delaware law and LNG’s bylaws.
  • In SEC filings Friday, LNG said it would “reassess its strategy” for bonuses following shareholder backlash.
Comments (8)
  • King Rat
    , contributor
    Comments (849) | Send Message
    Generally speaking the shareholders are correct. Adherence to SEC regulations does not make an action legal but Delaware is a very pro-principal state so stockholders have an uphill battle. Were the lawsuit in California Souki would already be forced to abdicate and forced into a life of gluten-free veganism.
    28 Jul 2014, 07:49 PM Reply Like
  • snaitch
    , contributor
    Comments (2) | Send Message
    Rules don't trump laws.
    28 Jul 2014, 08:54 PM Reply Like
  • devlau20
    , contributor
    Comments (255) | Send Message
    Another reason I won't buy this stock!
    28 Jul 2014, 09:39 PM Reply Like
  • Michael Bryant
    , contributor
    Comments (5755) | Send Message
    Well, if all shareholders sell (NYSEMKT:LNG) stock, maybe the CEO will get that shareholders rule. Or call Carl Ichan.
    28 Jul 2014, 10:51 PM Reply Like
  • 12208701
    , contributor
    Comments (4) | Send Message
    This is a well managed company. I have done very well holding this stock. While the compensation package may be a little rich, the management team certainly deserve to be well compensated.
    29 Jul 2014, 04:56 AM Reply Like
  • george oliver
    , contributor
    Comment (1) | Send Message
    very dissapointed in cheniere,they did not even make a delivery yet and greed rules the day
    29 Jul 2014, 08:41 AM Reply Like
  • TrendRider
    , contributor
    Comments (139) | Send Message
    I'm just holding out for a higher-high! I will sell between $80-100.00, unless we wake to a DOW down 300 points! I'm just waiting for a sale signal!
    29 Jul 2014, 10:22 AM Reply Like
  • Diggerdugit
    , contributor
    Comments (78) | Send Message
    12208701---"While the compensation package might be a little rich..."You think maybe?? OK the Company is well managed---but this guy is not worth that pay scale. And trust me, this management team is "Well Compensated". They saw to that fact themselves. If they all said we are going elsewhere---where would they go? You think somebody else is going to compensate them at this level?? I don't think so.
    29 Jul 2014, 12:34 PM Reply Like
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