AmerisourceBergen exec’s relo, sweet relo…

December 9, 2010

If it weren’t already obvious enough that the folks in the C-Suites don’t have to deal with many of the daily headaches that the rest of us have, let the preliminary proxy that AmerisourceBergen Corporation (ABC) filed Dec. 7 dispel any lingering doubts.

The fortunate executive at the heart of this example, Steven H. Collis, has been with AmerisourceBergen (or one of its predecessors) for 16 years. He has climbed steadily in the executive ranks during that time, and the board of directors appointed him as the new President/Chief Operating Officer just last month.

According to the proxy, AmerisourceBergen recently asked Collis to relocate from Dallas, TX to its headquarters in Valley Forge, PA. Many people who have relocated on short notice may have shared my experience: After we put the house on the market, we crossed our fingers that we had chosen a competent realtor and gritted our teeth every time we wrote two mortgage checks until the old place finally sold. Thanks to AmerisourceBergen’s board, however, Collis didn’t have to go through any of that.

Here’s the relevant section from the proxy:

In fiscal year 2010, we provided Mr. Collis with $1,199,862 in moving and other expenses associated with his relocation from Dallas, Texas to our corporate headquarters in Valley Forge, Pennsylvania. The Committee approved the payment of additional relocation expenses to Mr. Collis under our executive relocation program to mitigate, in part, some of the loss that Mr. Collis would incur as a result of his relocation and sale of his home in Texas at time when housing prices had declined significantly.

Housing prices have declined some in Texas, of course, and it’s estimated that they could dip again by about 1.4 percent through the summer of 2011; but this Nov. 16 article from The Dallas Morning News also reported that “home prices in the area were up an average of 3.4 percent at midyear,” a boost it attributed largely to the number of high-end home sales.

And Collis’s home definitely falls in the “high-end home” category… at least as far as we’re concerned. After first establishing Collis’s spouse’s name from a 2010 list of attendees at a National Association of Chain Drug Stores function (on which Collis’s position with AmerisourceBergen is confirmed), we then searched for the Collises’ home in Dallas.

We think we found it: It’s a luxurious Mediterranean mansion in a gated community that is (or was) titled in the names of Steven H. and Toni M. Collis. Assuming it’s theirs, the real estate listing describes the home as a massive 9,359 square-foot abode with 6 bedrooms, 8-full and 2-half bathrooms, and nice touches such as a 1750 sq. ft. pool house and a climate controlled wine room. Originally priced at $2.749 million when it went on the market March 30, the asking price is now just $1.9 million.

Yet interestingly, when the company and Collis agreed to the terms of the “Second Amendment and Restatement of Employment Agreement,” dated November 11 and attached as Exhibit 10.17 to the 10-K filed Nov. 23, there’s no mention at all of the relocation, moving expenses, or the company’s agreement to reimburse Collis for the loss on his prior home. The only reference that arguably touches on the topic is the section that states Collis and his family “…shall receive all benefits under, all welfare benefit plans, practices, policies and programs provided by the Company to at least the same extent as other senior executives of the Company;…”

To be sure, it’s possible that the board made the nearly $1.2 million decision after the terms of the new employment agreement had already been hammered out. Or maybe spending that much of the shareholders’ money didn’t seem like a big deal to the directors. But with the next annual shareholders’ meeting set for Feb. 17, 2011, the board may want to explain its decision in more detail.

Image source: TheTruthAbout via flickr

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