Editors Note: Updated at bottom with information about new change in control contracts Volcom signed with members of its executive team.
I followed up with PPR this week to find out if the company’s planned acquisition of Volcom includes employment contracts for Volcom executives.
I was curious about this because PPR executives noted during a conference call with analysts when the acquisition was announced that earn-outs for Volcom executives were not part of the deal.
Charlotte Judet, the Head of PPR’s Press Department in Paris, provided this statement to me via email about the issue of employment contracts.
“As you noted, there are no earn-outs. However, once the transaction is completed we expect to enter into mutually acceptable and appropriate incentive arrangements with senior management that will provide additional compensation to them based upon future value creation in the Volcom business,” she said.
“However, these arrangements have not yet been negotiated. We appreciate the support of the senior management team in the transaction and note the significant value they have already created in the company.”
The acquisition is expected to close in the third quarter of this year.
Volcom did recently enter into change of control agreements with certain members of its leadership team. While it did not provide specific details about every contract, it did provide information about several executive officers in documents filed with the SEC.
If the executives below are discharged by the company other than for cause within two years of a change in control or if they resign for good reason, they will receive:
Richard Woolcott and Jason Steris: cash equal to 2.5 times their annual salary, their 2010 bonus, prorated bonus for the year the termination occurs, medical and dental benefits for a period of time, outplacement services and vesting of all of then outstanding unvested stock options and restricted stock.
Doug Collier and Tom Ruiz: cash equal to 2 times their annual salary, plus their 2010 bonus, prorated bonus for the year the termination occurs, medical and dental benefits for a period of time, outplacement services and vesting of all of then outstanding unvested stock options and restricted stock.
Ethan Anderson: cash equal to 1 times his annual salary, plus his 2010 bonus, prorated bonus for the year the termination occurs, medical and dental benefits for a period of time, outplacement services and vesting of all of then outstanding unvested stock options and restricted stock.
If they were to leave, all of them would not be able to solict Volcom employees to leave the company and join them elsewhere for one year.
