Walgreen’s CFOs: coming and going

August 7, 2014

Walgreen Co., which has been engaged in a very-public soul-searching over whether it should or shouldn’t  leave the country in search of lower taxes saw its stock plunge nearly 15% plunge yesterday after it finally decided to stay put in Illinois. The news generated countless headlines (see here and here and here, for example). The 8-K providing more details was filed less than 3 minutes before the SEC closed up shop for the day on a day when around 500 8-Ks were filed.

But with all of this intense interest over to invert-or-not-to-invert, another 8-K filed late Monday afternoon, seems to have largely been ignored.  That one involved details on outgoing CFO Wade Miquelon and incoming CFO Timothy McLevish. Earlier in the day on Monday, the company announced that Miquelon, who had been CFO since 2008, was being replaced by McLevish, who had been CFO at Kraft Foods Group.

Needless to say, the details of Miquelon’s departure weren’t included in the press release, even though the release noted that he would be staying on in a transitory role until the end of the year. Come to think of it, nor were the details of McLevish’s arrival.

First up, the departing executive: Miquelon will get $3.2 million in cash severance and another $1.19 million in bonus, two years of health insurance coverage and over 130,000 options and RSUs. In exchange, Miquelon will be required to make himself “reasonably available to the Company or its representatives to briefly discuss matters relating to the responsibilities he held during his employment” as the company details in Ex. 10.2 attached to the filing.

Next, we’ll move on to the incoming CFO, McLevish, whose agreement was also attached to the filing. He’ll be paid a base salary of $800K, which is only a modest increase over what he was making at Kraft and over what Miquelon was making in the job. He’s also set to get a boatload of equity. Specifically, the filing notes that he’ll receive 580% of his base salary in executive stock options. With the price having fallen 15%, that simply means the options are much more attractively priced.

 

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