Viva la Revolucion at Furniture Brands…
Last week, on May Day no less, investors in Furniture Brands International (FBN), the furniture company whose brands include Thomasville and Broyhill, appear to have elected three directors proposed by activist investors, Sun Capital, which owns about 9.5% of FBN’s shares. Sun offered to buy the company, whose stock has declined sharply since 2002, back in February, but the company turned them down.
But judging by this 8K filed by FBN late yesterday, the company has a few revolutionary thoughts of its own. As yesterday’s filing notes, on May 1, the company’s board, which does not include the three new directors, not only increased CEO Ralph Scozzafava’s salary by 7% to $750K, it also increased his long-term compensation award from 200% to 300%, and increased the amount of money he would get under a change in control from 2 times base salary and bonus to three times. Several other executives also got a bump — from one times to 1.5 times — in the amount of severance they would receive.
We’re sure the timing of those changes had nothing — absolutely nothing — to do with the three new directors set to come on board.