Ed Has To Sack The C-Class Execs.

‘Bloody Brats’, writes Ed in his diary, referring to the 20-something year-old super-sharpies who monitor his company for its private equity owners, ‘they want me to sack all the C-class execs.’

‘”Why?” I asked The Brat when he rang up this morning, “they’re doing a pretty good job”.’

 

‘”We know that,” replies The Brat, but in the private equity business we don’t like to see execs get too cosy in their jobs, we like churn. It keeps the others on their toes and in lets in fresh aggressive blood – aspiring guys with a killer instinct”.’

 

‘”So we sack guys who are experienced and are doing a good job?” I asked.’

 

‘”You learn fast, Ed,” replies The Brat.

 

‘”Do you want me to sack them all at once?”‘

 

‘Are you being facetious? We take this seriously Ed. Take your time and sack them over a couple of quarters. And remember, no pay-offs.”‘

 

‘”What? Nothing at all.”‘

 

‘”If they get arsey tell them to read their contracts. Their contracts say they can be sacked at any time, for no cause, with no right to compensation and their unvested share options revert back to the company with no payment due to them. Get on with it, we expect to see the first one go within a week”.’

 

‘I’ve appointed these guys. I’ve motivated them. I’ve been to their homes. They’ve been to my home. But it’s them or me,’ Ed confides to his diary, ‘roll on my $25 mill.’

Tags: brat, c class, contracts, execs, facetious

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6 Comments

  1. David Manners
    August 16, 2012 14:03

    For most of them it’s their first experience of working for a PE company, cheese, if they didn’t get lawyered up they’d be screwed. I understand a typical contract of employment with a PE company will state that anyone terminated with cause, or who resigns within five years of their employment contract, is required to exercise their stock options immediately, and the company is entitled to repurchase the options at a per share price equal to the exercise price. It means that execs get no value in respect of any of the shares underlying their options. Vested and unvested shares held in a company before a PE acquisition lapse post-acquisition. That doesn’t cover pay-offs of course, but I wonder what leverage over the terms of his contract an exec has post-acquisition by a PE company.

  2. August 16, 2012 11:59

    I doubt if the C-execs are stupid enough to have signed contracts that are void of pay-offs. The C-execs of Eds world first negotiate the payoff packages even before understanding what they will need to achieve. It is also very likely that this payoff is the only thing they will know about the company :-)

  3. David Manners
    August 15, 2012 10:05

    Well George, The Brats don’t usually miss a dirty trick so it’s quite likely. I’ll have to research later diaries.

  4. georgegrimes-ti-com.myopenid.com
    August 14, 2012 14:49

    Like Lodekka, I’m wondering if Ed has the same clause in HIS contract? He may be in for a nasty surprise!

  5. Lodekka
    August 14, 2012 11:36

    I’m just waiting for Ed to discover the small print in his contract that has been carefully inserted (post his knowledge or last review) by the Brats, that means once has done the dirty work they can say ‘Oh Ed, by the way, a moment please’… And he gets the envelope…
    Rough justice maybe?

  6. greg
    August 13, 2012 20:23

    Its a little late for Ed to find religion now. The C’s know what an asshole he is. Good to see him put some stick about.

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