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Strategies & Market Trends : Galapagos Islands -- Ignore unavailable to you. Want to Upgrade?

To: Jorj X Mckie who wrote (47604)	9/17/2003 7:34:07 PM
From: MulhollandDrive	Read Replies (1) \| Respond to of 57110

this is what grasso's predecessor (and current head of the SEC) has to say about it...it's looking more and more like the structure is coming under scrutiny because of the pay package ...basically it seems that suddenly grasso's pay was the impetus that caused everyone to "get religion" about the potential for self dealing that scandalized certain US corporations <edit> so i guess it's gee dick, we WAY overpaid you, now we have to "kill" you <g> record-journal.com Source: NYSE Board to Ask Grasso to Quit By AMY BALDWIN NEW YORK - The New York Stock Exchange board of directors held an emergency meeting Wednesday and a source close to the board said they planned to ask chairman Dick Grasso to resign, amid rising fury over his $140 million pay package. The meeting began soon after the 4 p.m. close of trading. A spokesman for director H. Carl McCall, who heads the exchange's compensation committee, said the meeting was going on but would not confirm that the directors would ask Grasso to step down. "I am not going to offer something in the blind. I don't know what (McCall's) position will be coming out of today," said McCall's spokesman, Steve Greenberg. News of the gathering followed Grasso's call earlier for a special board meeting next week to "discuss current issues" and the recommendations of a governance committee, and the day before floor brokers were to meet to address outrage among NYSE traders. On Tuesday, four major pension fund leaders called for Grasso's resignation, condemning his payout as inappropriate for a regulator. Resentment over the multimillion dollar pay package was coming to a head on the exchange floor, as well, as active seatholders planned to gather after the market closed Thursday to discuss the issue with three directors who are also NYSE members. "We are calling for Grasso's immediate resignation in the interest of the New York Stock Exchange. We think Dick Grasso has to leave now in order for the exchange to move forward and restore investor confidence in the marketplace," said Michael LaBranche, the head of LaBranche & Co., one of the NYSE's largest stock-trading specialist firms. The NYSE revealed its top executive's pay for the first time last month as it announced Grasso's contract had been extended through 2007. News that he would receive a lump sum payment of $139.5 million in accrued benefits and tax-deferred savings sent jaws dropping across Wall Street. The funds accumulated over his 36-year career with the exchange, mostly during his eight years as chairman. Critics, from investor advocates to politicians and traders, say the lavish pay undermines the credibility of the exchange, a not-for-profit institution that is owned by its members and also serves as a regulatory watchdog. Thursday's meeting will be conducted by NYSE directors Christopher Quick, CEO of Fleet Specialist Inc.; Robert B. Fagenson, vice chairman of Van Der Moolen Specialists, USA; and James Duryea, president of J.M. Duryea, a private floor brokerage firm. The meeting is for active NYSE members, meaning seat owners who work on the floor as opposed to seat holders who lease their seats. Quick declined to comment through a spokesman Wednesday. Fagenson, who did not immediately return calls Wednesday, has previously declined to discuss what will happen at the meeting. Duryea could not be reached. Traders have reportedly circulated one or more petitions calling for a special meeting to discuss the situation. Many have also been critical of the board for approving the hefty pay package. Earlier this year, Securities and Exchange Commission Chairman William Donaldson _ Grasso's predecessor at the NYSE _ asked the exchange to examine its governance structure and take steps to conform with new rules applied to public companies following a streak of corporate scandals. Donaldson, who sent a sharply worded letter asking for more details about the pay package after it was announced, would not say Wednesday whether he thought Grasso should resign. Donaldson did indicate, however, that the SEC plans to ask more questions. "I was upset by the disclosures," Donaldson said Wednesday during a House committee meeting in Washington. He also emphasized that governance at the exchange is a "front-burner" priority for his agency, which oversees its regulatory functions. Meanwhile, the list of officials calling for Grasso's resignation continued to grow. Sen. Joe Lieberman of Connecticut, a Democratic presidential candidate, joined the chorus Wednesday. "Instead of setting an example of ethical leadership for the market he oversees, Mr. Grasso's behavior has shaken the faith of investors and the foundation of the stock exchange," Lieberman said. "For the sake of confidence in the market, it is time for Mr. Grasso to resign." He echoed concerns voiced by four major state pension fund leaders Tuesday. Those calling for Grasso to step down: New York State Comptroller Alan G. Hevesi, trustee of New York's pension fund; California state treasurer Philip Angelides, along with the heads of the California Public Employees' Retirement System and the California State Teachers' Retirement System; and North Carolina state Treasurer Richard Moore. AP Business Writers Meg Richards and Marcy Gordon contributed to this report.