Mallinckrodt changed its severance package policy in a move that could indicate it's preparing for a change in ownership structure, according to The Wall Street Journal.
The new policy allows departing executives to receive lump-sum payouts instead of installment payments and ensures the policy remains intact should the company change ownership structure.
Under the new policy, executives would be paid 12 to 18 months worth of their salary upfront and Mallinckrodt CEO Mark Trudeau would receive two years of his annual salary, in the case of "involuntary termination of employment for any reason other than 'cause.'"
The drugmaker also agreed to indemnify the board and executives in legal proceedings, including liquidating or merging with another company.
Mallinckrodt's stocks fell 90 percent this year in large part due to its involvement in the federal opioid trial. The company recently agreed in principle to a $30 million settlement, which would allow it to avoid the trial, set to start later this month.
Read the full article here.
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