Inc.’s CEO Mary Dillon does not have a golden parachute.
Speculation is building about the executive’s future at the retailer following Dicks Sporting Goods Inc.’s $2.4 billion deal for Foot Locker, revealed this week.
According to the shoe retailer’s proxy, filed with the Securities and Exchange Commission on April 10, Dillon received $12.5 million in total compensation, which included an annual base salary of $1.4 million, $11.0 million in stock awards and $69,777 in other compensation. The total represents a 14.9 percent decline from $14.7 million in 2023.
Her compensation package in 2023 included a base salary of $1.3 million, nearly $11.8 million in stock awards, $1.6 million in option awards and $37, 689 in other compensation. Foot Locker’s proxy, filed on April 10, indicates that other compensation includes medical expense reimbursement, supplemental life insurance premiums, universal life insurance premiums and 401(k) plan and excess savings plan match.
If she were to leave the company within two years of a change of control, Dillon would be entitled to a lump sum equal to two times the sum of her base salary, or $2.8 million presuming her 2024 salary doesn’t change, according to the proxy, which details the material features of her employment agreement. She also would be entitled to a bonus for the year that she leaves the company, based on actual performance. In both 2023 and 2024, the Foot Locker CEO did not receive a bonus.
When a top executive leaves the company in a change-of-control situation, severance under the so-called golden parachute typically involves a lump sum payment that’s equal to three times the base salary or more, plus a bonus. There are also provisions for the acceleration of stock awards and options. Dillon’s agreement provides for accelerated vesting of outstanding stock awards at different percentages, but the timing is beyond fiscal 2025, which ends on Jan. 31, 2026.
Foot Locker’s proxy notes that the company does not provide for any excessive severance or change in control payments.
The Dick’s transaction is subject to Foot Locker shareholder approval and other customary closing conditions, including regulatory approvals. It is expected to close in the second half of 2025.
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Dillon said that by joining forces with Dick’s, Foot Locker will be “even better positioned to expand sneaker culture, elevate the omnichannel experience for our customers and brand partners, and enhance our position in the industry.”
Foot Locker shareholders can elect to receive either $24 in cash or 0.1168 shares of Dick’s common stock for each share of Foot Locker common stock.
Foot Locker on Thursday reported preliminary first quarter results below expectations due to softer traffic trends globally. The company expects to post a net loss of $363 million for the quarter, versus net income of $8 million in the year-ago period. Comparable sales are expected to decrease by 2.6 percent from the prior-year period, with comparable sales in the North America region down by 0.5 percent. The shoe retailer is slated to report first-quarter earnings on May 29.
In 2024, the retailer posted net income of $12 million, or 13 cents a diluted share, on total revenues of $7.99 billion, which included net sales of $7.97 billion.
According to SEC filings, the merger agreement has a provision that Foot Locker may be required to pay a termination fee of $59.5 million to Dick’s should the deal not go through under certain conditions. If either party terminates the merger because it fails to garner regulatory approval by a certain date, Dick’s will be required to give Foot Locker a termination fee in cash of $95.5 million.
