Looking ahead in retirement at Xerox __»

May 25, 2010

Children, fiction writers and futurists like to play various versions of “what if” — all of us do now and then; it’s part of what makes us human. But few get to make it come true in quite the same way that corporate officers sometimes can.

Anne Mulcahy got to do it late last week, for example, when she stepped down as the chairman of Xerox Corp. (XRX) after 34 years at the company; she started as a sales rep in 1976. Ursula M. Burns, the company’s chief executive, assumed the chairmanship as of May 20.

Mulcahy’s departure was effective the same day, but in at least one sense she gets to retire like it’s 2011. According to the 8-K that Xerox filed late on Friday afternoon:

“the Compensation Committee of Registrant’s Board of Directors, in accordance with the terms of the applicable agreement, accelerated the vesting of the Long Term Cash Incentive Award made to Mrs. Mulcahy on June 30, 2009 (as described in the Proxy Statement) in an amount equal to what Mrs. Mulcahy would receive had her retirement occurred on or after the July 1, 2011 original vesting date.”

In other words, retire today, get a long-term cash bonus paid as if you retired 13 months later. Assuming her departure was indeed voluntary — there’s no reason to think otherwise, but it does sometimes turn out that senior executives are asked to step down — the proxy says she would have walked away on Dec. 31 with a total of $31.4 million, including $2.6 million in non-equity incentive awards, $6.4 million from equity incentive awards and $22.4 million in pension benefits — plus another $2.6 million in accumulated deferred compensation on top of that. It’s probably safe to assume the figure last week is pretty similar. (Involuntary termination without cause would add $1 million in cash to those figures.)

One of the big recent accomplishments from Burns and Mulcahy, we’ve already observed, was the recent acquisition of Affiliated Computer Services, with the attendant 2,500 layoffs. No doubt some of them would have liked to get a check on the way out the door that looked ahead to 2011 as well.

Image source: pasukaru via Flickr

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