Toll Brothers (NYSE:TOL) shareholders on Wednesday approved a controversial bonus plan for CEO Robert Toll as well as reelecting Robert Toll, Bruce Toll and CFO Joel Rassman to the board of directors during the company's annual meeting at its Horsham, Pa. Headquarters.
The bonus plan, which generated controversy among unions that hold shares as well as certain corporate governance advocates, will guarantee CEO Toll an annual payout equal to 2% of the company's pre-tax income plus a performance bonus determined by the board but not to exceed $5.2 million or 0.1% of gross revenue. The payout would be capped at $25 million.
Under the previous compensation package, Toll did not receive a bonus for the first time in 16 during fiscal 2007 due to the company's first quarterly losses ever. Under the new plan, he would have received approximatley $1.3 million plus whatever performance bonus the board may have approved.