Citrix to Cap Board Pay in Pact Approved by Del. Court

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By Michael Greene

Sept. 12 — Citrix Systems Inc. agreed to limit the amount of stock awarded annually to directors, in a settlement approved by the Delaware Chancery Court Sept. 9 ( Calma v. Templeton, Del. Ch., No. 9579-CB, order and final judgment 9/9/16 ).

Under the settlement, Citrix agreed to amend its “Equity Incentive Plan” to cap the annual equity compensation awarded to each non-employee director at a value of $795,000. The amendments will be presented to stockholders for approval at Citrix's 2017 annual meeting.

The company also agreed to file enhanced disclosures on its director compensation practices, and clarify the responsibilities of its compensation committee.

The settlement resolved a 2014 lawsuit in which shareholder John Calma challenged Citrix's awards of restricted stock units to eight non-employee directors in 2011, 2012 and 2013.

No Shareholder Ratification

In an April 2015 decision— Calma v. Templeton,2015 BL 125718—the chancery court rejected the defendants' argument that the lawsuit should be dismissed because the compensation plan was approved by shareholders. The court found the defendants couldn't rely on the shareholder ratification defense because the plan didn't set the specific compensation to be granted to non-employee directors or meaningful ceilings on potential pay (13 CARE 953, 5/8/15).

To contact the reporter on this story: Michael Greene in Washington at mgreene@bna.com

To contact the editor responsible for this story: Yin Wilczek at ywilczek@bna.com

For More Information

The settlement agreement is available at http://src.bna.com/ivx.

The court order approving the settlement is at http://src.bna.com/ivy.

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