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GoPro CEO’s promise to a college friend just cost him $229 million

May 14, 2015, 1:11 PM UTC
GoPro creator Nick Woodman
GoPro creator Nick Woodman
Photograph by Victor J. Blue — Bloomberg via Getty Images

GoPro’s top executive Nick Woodman, the highest paid CEO in the U.S., is generating headlines for keeping his word — even if it costs him millions of dollars.

Woodman, who steers camera maker GoPro (GPRO), saw his fortune drop by $229 million this week after he returned 4.7 million shares to the company, according to a Bloomberg report. He was handing back the shares as part of an agreement he struck with the company for stock options that were granted to Woodman’s college roommate Neil Dana, who attended the University of California at San Diego with Woodman.

Why was Woodman so generous? Well, he was making good on a verbal agreement he struck with Dana more than a decade ago, when he agreed to share 10% of any proceeds he received from the sale of GoPro shares held by Woodman. The terms of this promise were even disclosed in GoPro’s S-1 filing with the Securities and Exchange Commission as the company was gearing up to go public last year.

To cancel that agreement, GoPro issued Dana more than 6 million fully-vested options in June 2011, and 270,000 restricted stock units six months later. Woodman, meanwhile, agreed to reimburse the company when the options were exercised, Bloomberg reported. Bloomberg said they were valued at $229 million at the close of trading on Monday.

The amicable way this has played out differs from the scuffles observed at other high-profile technology companies. Lawsuits ultimately settled verbal disagreements about alleged promises made during the early development at tech firms such as Facebook (FB) and Snapchat.