Daily Management Review

Huge Payouts For Twitter’s Top Executives Fired By Its New Owner Elon Musk


Huge Payouts For Twitter’s Top Executives Fired By Its New Owner Elon Musk
According to Equilar, three top executives of Twitter Inc who were fired by new owner Elon Musk will receive separation pay totalling $122 million.
According to people familiar with the situation, Musk fired Twitter CEO Parag Agrawal, Chief Financial Officer Ned Segal, and legal affairs and policy chief Vijaya Gadde. He accused them of deceiving him and Twitter investors about the number of bogus accounts on the platform.
Equilar, known for its research on executive compensation, valued Agrawal's so-called "golden parachute" at $57.4 million in an email to Reuters, while Segal's was $44.5 million and Gadde's was $20 million.
In addition to those payouts, Musk will pay the three executives a total of $65 million in exchange for shares they held in the company he has now taken private.
Gadde's stake was the most valuable, valued at $34.8 million based on the final sale price of $54.20 per share, followed by Segal's stake of $22 million and Agrawal's stake of $8.4 million.
Agrawal, who was previously Twitter's chief technology officer, was named CEO in November of last year. According to a Twitter securities filing, his total compensation for 2021 was $30.4 million, primarily in stock awards.
Major payouts to executives tied to changes in control of a company are common in order to smooth ownership transitions, but they can be contentious.
According to Twitter's filing, payouts during a change in control event "maximize stockholder value while maintaining executive focus."
According to the filing, payouts would include 100% of an executive's annual base salary, healthcare premiums, and accelerated vesting of equity awards.
Courtney Yu, director of research at Equilar, stated that the fired Twitter executives "should be receiving these payments unless Elon Musk had cause for termination, which in these cases is usually that they broke the law or violated company policy."