April 10 Avon Products Inc's incoming
chief executive Sherilyn McCoy would get sweetened benefits in
the event she leaves the cosmetics company following a takeover,
according to her employment contract.
McCoy will take over at Avon on April 23 following a 30-year
career at Johnson & Johnson.
But Avon's future is uncertain, given the unsolicited
takeover bid from fragrance company Coty Inc. Avon has rejected
the bid, arguing the company's value could rise more under a new
CEO than as part of Coty.
If Avon were to terminate McCoy without cause, or if she
were to quit for "good reason" after three years with the
company, she is entitled to two years of her base salary, set at
$1.2 million a year, according to her contract, which was made
public in a securities filing on Tuesday.
If the termination occurred during the first three years,
she would also be entitled to an amount equal to two times her
annual incentive bonus target, which is 150 percent of base
However, if the termination were to occur within two years
after a "change in control," McCoy would be entitled to three
times salary and annual bonus rather than two times, and the
benefit continuation periods would be three years rather than
In addition, McCoy will receive a signing bonus of $1.9
million, which is subject to repayment if she does not stay
employed for five years; 200,000 shares of restricted stock and
a deferred cash payment of $850,000 payable on her fifth