When car service isn’t good enough…
If crime is down sharply in NYC and even Mayor Bloomberg rides the subway on a regular basis, why does the new CEO of New York-based Ann Taylor Stores (ANN) need a car and driver for security purposes as noted in the 8-K the company filed last week? Are we really to believe that an executive of a moderately priced women’s clothing chain is in more danger than Mayor Mike? And, of course, the value of that car and driver for Katherine Krill will be grossed up for taxes. That’s in addition to the $1 million in salary, 200,000 options, and 400,000 restricted shares.
A quick skim of Ann Taylor’s prior SEC filings shows that in the past, the company provided regular car service for its execs, instead of a full time car and driver, which presumably would be much more expensive, though there’s no details in the filing. Indeed, when J. Patrick Spainhour retired at the end of September, he had to turn in his “car service cards” — cards used to charge the car service fees back to the company.
If the company chooses to provide Krill with this service as a perk and the associated gross-up, it’s obviously their right. But don’t give investors some mumbo-jumbo about this being necessary for security purposes. It only insults our intelligence.