Dave Brandon - Toys "R" Us Salary
Presented without comment.
Mr. Brandon’s Employment Agreement
In connection with Mr. Brandon’s appointment as Chief Executive Officer, the Company and Mr. Brandon have entered into an employment agreement with an initial term of five years, with automatic renewals for successive one-year periods unless either party delivers a timely notice of non-renewal. The agreement further provides for the following compensation and benefits:
Base Salary and Bonuses. An initial annual base salary of $3,750,000 per year, which may be increased at the discretion of the Company’s Board of Directors, and an annual bonus targeted at 120% of annual base salary (with a maximum possible bonus of 160% of annual base salary), subject to achievement of performance targets established by the mutual agreement of the Board of Directors and Mr. Brandon. Mr. Brandon’s annual bonus for the 2015 fiscal year, if any, will be pro-rated based on the number of days for which Mr. Brandon is employed by the Company in that fiscal year. In addition, the Company will pay Mr. Brandon a one-time bonus of $4,250,000, payable in a lump sum within ten days of June 1, 2015.
Perquisites. Mr. Brandon will be eligible for the Company’s welfare benefit plans and retirement plans, including the Company’s 401(k) and supplemental executive retirement plans and medical, dental and life insurance plans, as in effect from time to time on the same basis as other senior executives of the Company. In addition, the Company will also provide Mr. Brandon with the use of a Company-paid automobile (or alternative ground transportation) and the use of a private aircraft for Company business travel and specified personal travel (together with a tax gross-up for the income attributable to him for the use of the aircraft). The Company has also agreed to reimburse Mr. Brandon for specified legal fees as more fully described in Mr. Brandon’s employment agreement and to provide Mr. Brandon its relocation package available to other senior executives.
Long Term Incentive Awards. Mr. Brandon will also participate in the Company’s long-term cash incentive award program, which will provide him with a long term cash incentive award, effective July 1, 2015, under the Company’s 2010 Incentive Plan, of two payments of $18,750,000. The award will vest and become earned upon achievement in any fiscal year ending on or before the last day of the Company’s fiscal year ending January 2018, of a specified level of Adjusted EBITDA less average capital expenditures for the prior three fiscal years, as more fully described in Mr. Brandon’s incentive award agreement, subject, except as set forth below, to Mr. Brandon’s continued employment through the end of the fiscal year in which such condition is satisfied. If earned, the first payment under the award will be made shortly following certification of achievement and the second payment under the award will be made one year following certification of achievement.
http://www.sec.gov/Archives/edgar/data/1005414/000119312515213371/d9355…
http://www.sec.gov/Archives/edgar/data/1005414/000119312515213371/d9355…
I don't think the argument is against paying CEOs of major corporations this kind of money. It's against paying Dave Brandon, a tone-deaf megalomaniac, that kind of money
I thought they hired him to wear the giraffe costume and shill people into the store from the street.
Apparently, the only "qualification" for a "competitive CEO salary" is experience as an overpaid CEO. What a great job; the more companies you run into the ground, the more "experience" you have and the more money you command in the marketplace.
We should all start emailing him and see if we can get some replys from him in the same vain as when he was here. Then left nature take its course.
Is he really a "bad person"? He wasn't a good AD, and he might have been a bit of a jerk, but there are so many people in this world worse than Dave Brandon. And I'll take the negs for saying it, but he's gone and he isn't coming back. Michigan's great national nightmare is over, and to keep wishing him ill-will is like those couple of diehards who keep hating on RR yeasr later and who will hate on Hoke the next time he coaches.
But I want to go back to school to be a CEO. Easiest job out there.
...you get to write a book and go around telling everyone "how the economy really works."
He has it easy too. It's SOOOO easy to be a leader of organization. It's not like you won't get second guessed or your reputation torn to shreds because of actions of others within your organization.
The average person doesn't much understand the pressure or responsibility of leadership. How can they? They are part of a mob of Know-it-Alls who are the greatest at everything they have ever done.
Dave Brandon is an asshole as are many(if not most) CEOs,. But that doesn't mean being a CEO is an easy job.
Sure, they make shitloads of guaranteed money. That's the benefit of leverage and value. Unfortunately, we peons have very little value. We are not a rare commodity.We do not have the same value in our respective fields as CEOs, presidents, professional athletes, musicians, etc. Harsh, but true.
Spot on SQ!
...pressure (my father held an executive position at a large organization). I don't think very many people question the idea of paying executives more than the average employee. The question is whether they should earn, say, 331 times more than the average employee.
A very big downside to a country in which CEOs make 331 times^1 more than the average worker is that the arrangement guts the middle class, which means fewer consumers with disposable income. And because money is speech, it concentrates power (which comes from political speech) in the hands of a relative few, which is bad for democracy - or at least the "one man - one vote" version of democracy in which we are all more-or-less equal actors.
It's worth remembering too that CEOs are not generally entrepreneurs. They gamble with other people's money. And in the worst cases they put short-term gain above the long-term health of their companies and then make off with huge golden pararchutes while the shortsighted decisions they made come back to bite their now-former company.
1 - I get this number from Forbes (which referred to 2014). http://www.forbes.com/sites/kathryndill/2014/04/15/report-ceos-earn-331-times-as-much-as-average-workers-774-times-as-much-as-minimum-wage-earners/
It's the lack of well-paying low skilled jobs(e;g: manufacturing) that has gutted the middle class. We had a healthy middle class because we had jobs that people could migrate to after high school where they could earn a good living without incuring the expense of higher education.
Now such jobs require college degrees that in addition to getting a person into debt also are no guarantee in assisting someone in landing a well-paying job that their parents ot grandparents only needed arms and legs for.
I do agree about the shortsighted nature of modern CEOs. But that's the result of shortsighted stockholders and boards, not just CEOs. The inability to see the long term is the gravest problem with business today. Good businesspeople understand that you need to disperse the wealth in order to keep producing wealth.It goes hand-in-hand.
I have to strongly disagree about the political power point. Between academia, internet music, and cinema the Populist Left has managed to spread it's message quite easily. The idea that "democracy" is being subverted is a myth devised by Leftists to cover their own subversion of supposedly apolitical institutions like academia. The truth is that Left and Right have undermined democratic institutions and rights. Corporations buy influence and Populists "stir up the animals" to achieve their ends. We are being manipulated on a daily basis by both sides yet we don't even notice it.We just uncritically accept what we are being told because of the prestige of the speaker or how well-crafted the message is. We the people are far too preoccupied with our own problems to really analyze issues. Hence, we gravitate towards the answer that best accords with our beliefs.
This is relatively simplistic view of what happened to the middle class. A lot went into it. Trade deals certainly, changing tax policies, decaying infrastructure, reduced union representation, the rise of the service economy, most things requiring a college degree at the same time tuition costs skyrocketed putting people behind for owning a home etc, rising medical costs, and I think swinging the benefit packages more towards the high end is naturally going to lower the amount available for the average worker. Lots of contributors.
Another problem that is related to the plight of the middle class is the sort of general decline of meritocracy, where a multiple failure like Dave Brandon keeps failing upwards into positions of power. There was always a good ole boy network but it seems to me there's a general lack of accountability if you're powerful enough (politicians and bankers being the obvious examples here).
Agree on short sightedness being a major problem.
As for the political point. I think reducing that to a purely partisan thing is mistaken. I agree more with say, Warren Buffett than Charles Koch, but I don't want either of them to be able to finance entire presidential campaigns. It limits access and what viewpoints politicians hear, and that's a problem and yeah, that subverts democracy and replaces it with plutocracy. Also populism is not strictly left or right wing, it's just populism. It's an appeal to the masses that they're not getting a fair deal because of those other people. The other in question could be business interests (usually lefty), academia (right), or more toxic insinuations (the famous Atwater quote). That's all populism.
I should have said that the current difference in compensation between CEOs and everyone else helps/has helped to gut the middle class. As you note, it has not by any means been the only problem.
but it seems like globalization has hurt it. I work for a large corporation and over decades manufacturing has moved more overseas as demand rises over there but labor remains cheap. Tough to compete as a skilled laborer making $30/hr with guys who roughly as skilled getting paid $10/hr.
The short-sightedness is on point. I see it all the time. No thought for what happens in 10, 20 years (especially amongst the activist investors) but only thought for "Where can I get the stock price in 2 years?". Major companies are slaves to shareholders for better or worse.
"Between academia, internet music, and cinema the Populist Left has managed to spread it's message quite easily. The idea that "democracy" is being subverted is a myth devised by Leftists to cover their own subversion of supposedly apolitical institutions like academia."
I didn't really take you seriously before, but now I'm just laughing.
Or just wanted to get a punchline in.
Have you ever been the leader of an organization that large? Do you know the hours put in? A lot of CEOs who last a while age like they're the president. It's fun to assume everyone is a fat cat Wall Street guy, but the reality is that being CEO is a tough, time consuming leadership position
I didn't need to see this
that clicking on this thread would make me want to stab someone, and yet I did it anyway.
Hopefully, his Michigan buy-out doesn't have to be paid now.
I am just hoping he will hire Brady Hoke as Head of PR and we can hear,
"This is Toys R Us, Fer God Sakes"
And we wont have to pay Brady's contract either!
Did he really reply to you or someone else with that or is that shopped?
That is authentic.
Meet the story that put MGoBlog into the New York Times, ESPN, Sports Illustrated, and about a hundred other big time (and big time-ish) publications.
http://mgoblog.com/content/david-brandon-i-suggest-you-find-new-team
221,000 reads later...
Ditto.
I wonder if any of these came up in his meeting with the Toys R Us board when they hired him. His departure was pretty public (remembering back to the Today Show's coverage of concussiongate). I would love to hear the spin he put on it. Perhaps he had an executive headhunter who did the job for him.
This is actually good for UM as we don't have to pay as much of the buyout, I believe.
ETA: Also, that FAO Schwartz rent sure seems like it was too steep now, huh.
Yeah, this should cover all of what Michigan owed him, right? Assuming he keeps the job for a few years.
Given all this, he should personally cover the remainder of Brady Hoke's contract. What a joke.
Sent from MGoBlog HD for iPhone & iPad
Maybe I should make a remix of this.
Ira played the Toys R Us Kids theme today on the show during the mgoblog segment.
for old time sakes-
What an epic douche.
Fuck me.
only if you do not wear protection ;)
Maybe, what do you look like???
This isn't Caitlyn, is it???
Fuck Dave Brandon! Dude should be making at least $3,750,000 less per year.
TL;DR version: $3.75M/year with 120% bonus. $4.25M sign on bonus. Car & plane. Two $18.75M long term cash incentives to vest Jan 2018.
Keep in mind that this guy squeezed the university out of every dollar it owed him just to go away. The buyout is probably why his lame duck period lasted five full weeks. It would appear he didn't budge.
Having this mega capitalist at a public university in a non-profit department was such a stain on our reputation. Mary Sue should be forever ashamed of herself.
Dave Brandon is a douchebag, but a CEO is much more important to a company than a single teacher is to a community. His/her decisions can destroy or grow a company and thus impacting tens or even hundreds of thousands of people. A teacher's decisions impact only those in their classroom.
I really detest these type of analogies because they in no way comparable. You might as well compare a teacher to a King or a President. The difference is that great.
Solid again SQ! Upvote
Conceptually your arguments make sense but isnt the president an important job?
Guy makes $400K. So in terms of your "how many people he affects" you should be filing a petition to get that guy paid $500M a year.
Personally I don't know any CEOs. Doctors are everywhere and making $MONEY$. CEOs are important, buy into a companys stock plan and a CEO can make everyone wealthy. Brandon probably takes around $50 a year from every employee. That being said, screw Toys R Us for hiring that guy. And if you live in New Jersey, you live in the same state as him.
As if living in Jersey weren't bad enough.