Office Depot (ODP) is surging nearly 10% after a filing with the SEC signaled a takeover may be on the horizon.
The office supply retailer entered into a new change-in-control agreement with CFO Michael Newman; President of International Charles Brown; and Steven Schmidt, president, North American business solutions; in order to "diminish the potential distraction due to personal uncertainties and risks that inevitably arise when a change of control is threatened or pending."
As part of the agreement, the three executives are guaranteed employment for a year after a change of control, paying them 12 times their highest monthly salary, plus a bonus equal to the highest received in the prior three years. If they decide to leave, they will get their accrued salary and bonus, plus two times their base salary.This follows another filing last month that outlined the chief financial officer's retention agreement, which provided for the immediate vesting of his two-year retention payout if his employment was terminated for a reason other than cause. In October, former CEO Steve Odland resigned a week after settling regulatory charges with the SEC that alleged Office Depot selectively warned analysts about disappointing profits.