Federated Buy Would Leave Broadway CEO With $3 Million
- Share via
Broadway Stores Inc. Chief Executive David Dworkin could pocket a $3-million lump sum if Federated Department Stores Inc.’s proposed purchase of the retailer is completed.
The payment would be part of a severance plan the struggling retailer put in place July 31, two weeks before Broadway agreed to be bought by Federated in a stock swap, according to a form S-4 filed with the Securities and Exchange Commission.
Under the plan, Dworkin would receive a lump sum of $3 million--or three years’ base pay--within two weeks of a change in control of the Los Angeles-based company. As part of his employment contract, he would have received two years of pay, or $2 million.
The plan also covers five other executives, including Chief Financial Officer John Haeckel. They would receive smaller payments upon change of control or if they lost their jobs within a year of a takeover.
Cincinnati-based Federated’s purchase of the financially strapped retailer--which saved Broadway from seeking bankruptcy protection and would give Federated a larger presence on the West Coast--is expected to close in October.
Industry analysts value the stock swap at $373.3 million. In addition, Federated would assume Broadway Stores’ debt of $1.3 billion.
Federated owns, among others, the Bullock’s, Macy’s and Bloomingdale’s retail chains.
Inside the business of entertainment
The Wide Shot brings you news, analysis and insights on everything from streaming wars to production — and what it all means for the future.
You may occasionally receive promotional content from the Los Angeles Times.
