new york
CNN
—
Norfolk Southern CEO Alan Shaw sold $448,000 worth of company stock this week, a month after the deadly train derailment in East Palestine, Ohio.
The sale of Shaw’s stock came the same week the company announced that Shaw had personally created a $445,000 scholarship fund for East Palestine High School seniors, which an unspecified number of students could use to attend college or trade schools.
The share sale was completed in May 2022, in accordance with the terms of a pre-agreed plan entered into shortly after he was promoted to CEO. Company insiders often have such plans so they can sell shares and not worry about insider trading, which would be illegal.
Shaw’s plan is to sell 2,000 shares of Norfolk Southern every three months. He sold 1,000 shares on June 1, and then 2,000 shares on September 1, December 1, and March 1, a few weeks after the plan was executed. A total of $1.7 million was received for the sale of shares.
Shares of Norfolk Southern ( NSC ) are down 9% since the Feb. 3 crash, and the $448,000 it took in the latest sale was 13% less than it took in the December sale.
Company insiders must report purchases or sales of stock or exercise of stock options to the Securities and Exchange Commission so that they are known to other investors.
Norfolk Southern did not respond to requests for comment about the stock sale and whether Shaw planned to take a pay cut or more after the accident.
While his stock sale is typical for a CEO, it’s an indication of how well he’s paid to run one of the nation’s four major freight railroads.
Norfolk Southern has yet to release its 2022 payroll. This can be done at the end of the month. Shaw only became CEO on May 1 last year, serving as chief marketing officer until December 2021, after which he was elevated to the railway chairmanship five months later as a transition to CEO.
Shaw’s total compensation in 2021 was $4.3 million. As CEO, his predecessor, James Squires, received $14 million that year, more than the $12 million the railroad paid to residents and community groups in East Palestine.
Last year, Shaw may have been paid less than Squires in 2021, even though the company posted record profits last year. That’s partly because Shaw has been CEO for only eight months. Shaw’s base salary of $950,000 is below the $1.1 million he received in his final year on the job in 2021, and $4.7 million in bonuses and additional stock awards is less than the $8.6 million target.
Although the railroad is expected to continue its record earnings, its stock could be hurt by the disaster publicity.
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