Once again, as Wall Street waits for happy hour, we Fools wade into 8-K filings that, if the timing is to be believed, executives would rather you not read.
Kicking off today's list is this filing from network security specialist Sourcefire (Nasdaq: FIRE ) , which revealed that General Counsel and Secretary Joseph Boyle resigned on Aug. 6. He'll receive his salary and health benefits through the remainder of the year.
But Sourcefire won't be lacking leadership. In a press release filed after market close on Friday, the company announced that webMethods refugee Douglas McNitt would take Boyle's place, effective Sept. 4.
It's not goodbye till the cash runs out
Others are paying executives just to leave. Witness Hypercom (NYSE: HYC ) , which makes equipment for electronically processing payments. On Friday, the firm agreed to a severance deal with Senior Vice President O. B. Rawls IV.
It's a pretty sweet arrangement. Rawls gets a consulting contract that pays $75,000 through Nov. 9. Then, from November to May, he gets another $150,000 in salary. Then, after May, if he hasn't joined a competitor, he's due another $75,000.
And did I mention that, as of Dec. 31, he had 133,850 options exercisable at $3.50 per share? (Rawls forfeited 30,000 out-of-the-money options as a result of his severance. Shocking.)
But you have to wade through streams of DNA to see what a sweet deal really looks like. Just ask the executives that Helicos BioSciences (Nasdaq: HLCS ) , which specializes in technology for genetic research.
Helicos said on Friday that it has offered J. William Efcavitch, its senior vice president of product research and development, extra payments if he's terminated or suffers a cut in pay as a result of a buyout.
Among the perks: immediate payment of three-fourths of his annual salary, full acceleration of all of his outstanding stock-based compensation, nine months of health benefits, and a bonus equal to the average bonus paid to him over the prior two years.
Interestingly, this sort of deal isn't at all unusual in the biotech industry. Affymetrix (Nasdaq: AFFX ) promises its executives 18 months of salary and health benefits as well as vested options. Applera (NYSE: ABI ) offers its executives up to three times their annual salary plus accrued incentive compensation.
Do you think maybe it's time I took the advice of my Rule Breakers teammates and learned a little something about biotech? Sheesh.
Maybe investors should object
But my favorite filing this week comes from e-commerce specialist iMergent (AMEX: IIG ) . On Friday, the company said it is appealing a California court's order that would force it to file under that state's law governing seller-assisted marketing plans.
It's not the first time iMergent has tangled with California state officials. A deal that included some $550,000 in fines was originally reached last year. Now, according to this 8-K, state officials contend that iMergent didn't abide by the earlier deal. Quoting:
On July 25, 2007, the Ventura County (CA) District Attorney notified iMergent, Inc. (the "Company") by telephone call to its California legal counsel that the State of California and the Ventura County District Attorney filed a complaint, motion for temporary restraining order, and motion for preliminary injunction against the Company. ... The complaint seeks an injunction and penalties based upon alleged violations of the California Seller Assisted Marketing Plans Act (California Civil Code 1812.200-1812.221 "SAMP ACT"), the Unfair Competition Law (California Civil Code 17200), and the Business and Professional Code (California Civil Code 17207.) The action further alleges that the Company failed to abide by the terms of a previous order by failing to register under the Seller Assisted Marketing Plans Act. [Emphasis mine.]
I'd consider this pretty minor stuff if:
(a) A deal hadn't already been reached.
(b) Other states hadn't pursued similar claims (e.g., Indiana, Texas, and Utah).
(c) Executives weren't already being accused of selective disclosure.
(d) iMergent weren't being investigated by the SEC.
But, sadly, all of that is true. Better steer clear of this stock till we know exactly what California's regulators have found.
Found a late filing we Fools should see? Let me know.
Fool contributor Tim Beyers usually favors two scoops of ice cream over the inside scoop. Tim didn't own shares in any of the companies mentioned in this article at the time of publication. Find Tim's portfolio here and his latest blog commentary here. The Motley Fool's disclosure policy may be filed under "F" for fair, or Foolish.