Back on July 20, as part of a series of changes in its Energy business, General Electric (GE) mentioned — almost in passing — that veteran executive and GE Vice Chairman John Krenicki would be leaving the company at the end of the year. Although Krenicki has been at GE for 29 years, his departure was in paragraph #10. Despite this, GE Chairman and CEO Jeff Immelt had some nice things to say about Krenicki:
—In his 29 years with GE, John Krenicki has always made decisions with the best interests of our shareholders and our customers first. The decision to simplify the Energy Infrastructure business shows the kind of leadership John has demonstrated over the years. He will leave behind a tremendous legacy of operating businesses, and developing talented leaders.
A few days later, GE filed this 8-K, which provided a few more details about Krenicki’s departure. The first thing that caught our eye was the $89,000 per month allowance until he turns 60. That’s just over $1 million a year. While GE’s 2012 proxy doesn’t appear to list Krenicki’s age, this Fortune piece from last December, which suggested that he was a top candidate to replace Immelt when he retired, listed Krenicki’s age as 49. So the allowance alone probably works out to over $10 million.
But, wait, there’s more. The 8-K notes that all options that are set to vest “on or before” December 31, 2014, will now vest. Last year (again according to the proxy), he got 850,000 of those at $18.58 a share. And he had just over 2 million options that had not vested.
Even for us, GE’s proxy is pretty complicated, so figuring out an exact number is a bit difficult, especially since GE only provided a summary of Krenicki’s benefits in the 8-K, as opposed to an actual contract. Perhaps they’ll do that in an upcoming filing, though it was not included in the 10-Q that the company filed on Monday. In exchange, Krenicki was required to sign a worldwide non-compete agreement.
Whatever the final number winds up being, an $89,000 per month allowance for the next 10 years is a lot, even for someone with a long work history.
And now a special note for any children reading this post: try asking your parents for this kind of allowance and see how they respond.
It’s a filings crunch and with Sonya and Theo both on vacation, I’ll be posting less frequently this week so that I can focus on reading filings and providing the most actionable information to footnotedPro subscribers. For more information, or to inquire about a trial subscription, please email us.