CEO leaves company, gets 210M severance package

The company's vice chairman has stepped in as its new chairman.
ATLANTA (AP) -- Dogged by criticism of his hefty pay and his company's poor stock performance, Bob Nardelli abruptly resigned as chairman and chief executive of The Home Depot Inc. after six years at the helm of the world's largest home improvement store chain, the company said Wednesday.
But he didn't leave empty-handed: the Atlanta-based company said Nardelli would receive a severance package worth roughly 210 million, an amount decried by some lawmakers as a golden parachute that sends the wrong message to investors.
"It's a sign of being totally out of touch," said Rep. Barney Frank, D-Mass., the incoming chairman of the House Financial Services Committee. "They don't understand the extent to which they make the American public angry."
Frank said he would push for legislation requiring public companies to allow shareholders to have a say in compensation and severance for senior executives. At Home Depot's annual meeting last May, shareholder proposals to give investors a say on the CEO's pay and to restrict retirement benefits for senior executives were rejected.
In the package
Nardelli's severance package includes a cash payment of 20 million and the acceleration of unvested deferred stock awards currently valued at roughly 77 million. A Home Depot spokesman said the timing of the resignation, which was effective Tuesday, had no bearing on the amount in the package.
The total package is seven times the 30 million Home Depot set aside last June for stores and employees that provide good customer service. Home Depot has 2,127 stores and 355,000 employees in the United States, Canada, Mexico and China.
Home Depot said Nardelli was being replaced by Frank Blake, its vice chairman, effective immediately.
Home Depot co-founder Bernie Marcus, who had a hand in hiring Nardelli, said he supports the board's decision to replace Nardelli with Blake.
"My concern is what happens in the future, and I feel very good about it," said Marcus, who no longer works for Home Depot in any official capacity but remains one of the company's largest individual shareholders.
Asked about the severance payout, Marcus said the amount won't be that big a deal in the long-run if the company's stock price improves.
"It's like the old story, if the stock goes up 10 points, who's going to care?" Marcus said.