Proxy statement
- Read the case.
- Access the 2019 proxy statement WWE (ticker: WWE) posted to SEC’s EDGAR portal on March 6, 2020.3
Use the following link for access to EDGAR: https://www.sec.gov/edgar/searchedgar/companysearch
Executive compensation
- Howmuchdidthekeyexecutivesearnincompensationin2019? (See the table on page 23 of the proxy statement.) What were the primary components of their compensation?
- Examine how the stock awards are structured and valued (see note 1 to the table on page 23). In particular, look at the grant to chairman and CEO Vince McMahon. Assume this grant was issued on January 1, 2019, and vests equally over three years and answer the following: (a) How would this grant affect the income statement, balance sheet, and statement of cash flows at the end of 2019, 2020, and 2021 (see the reference text for guidance)?; (b) What was the fair value of this grant as of January 1, 2019 (roughly)?; and (c) What would be the fair value if the highest level of performance conditions for these performance stock units had been achieved?
- What targets did the compensation committee set for the annual incentive bonuses (see the discussion starting on page 16)? Did the company meet these targets? Why do you think the committee chose these three performance measures? Can you think of any alternative measures?
- How did Vince’s total compensation compare to the median WWE employee (see page 33)? Why do you think WWE discloses this ratio?
Ownership structure
- How many shares of equity are authorized, issued, and outstanding for WWE as of 2019? (Note: you will need the case exhibits to answer this question.)
- If WWE were to pay a dividend of $1per share, how much would Vincent K. McMahon receive (see the table and footnote 1 on page 34)? If he were to vote all his shares, what proportion of the total vote would he cast?
3 References to page numbers throughout refer to the proxy statement.
