If Twitter's CEO Is Fired, He'll Get A Massive Stock Payout
When CEOs at large US companies are fired they often have big severance packages in place. These "golden parachutes" give them big money if they're kicked out at the whim of angry stockholders or a capricious board of directors.
Costolo has one too. It looks like Costolo's package would be worth about $37 million if he goes. We sent two messages to Twitter requesting comment but didn't hear back.
According to Twitter's most recent filing with SEC on this topic, Costolo gets only a tiny sum of cash if he is asked to leave: A lump sum of 100% of his base salary, which is only $14,000.
But all his Twitter shares and options vest immediately, a package valued in total at around $37 million when the disclosure was filed back in May 2014. The stock was worth just over $31 at that time; it's worth $38 now, so the value of the package has changed likewise.
If he isn't fired, Costolo must work at Twitter until 2016 to get all that stock, which vests in stages, the filing says.
That compensation comes on top of roughly $310 million in stock (at today's price) that Costolo has already been given for taking the company through its IPO. Again, because the value of $TWTR changes over time, and because Costolo is selling his stock awards in chunks, that number will fluctuate.
But it's still a pretty big number!
Disclosure: The author owns Twitter stock.