Mike Ellis, former president and COO of Kroger, retired in June. However, the separation agreement, which was recently made public through a Securities and Exchange Commission filing, raised questions about why he left the company.
Ellis, a 40-year veteran of Kroger, started his role as president and COO in January 2014, serving just a year and a half in this position. Previously, he had been senior VP of retail divisions since 2012 and president of Kroger-owned Fred Meyer for six years.
However, the SEC filing had "unusual" language, according to Michelle Leder, editor and founder of SEC filings research firm Footnoted.com, Cincinnati Business Courier reported. She noted the portion of the filing that instructed Ellis to state only, "I chose to retire from my employment" if asked about his separation from the company.
In addition, Kroger vested all of Ellis' outstanding stock options, worth $2.7 million, as part of the agreement, Cincinnati Enquirer reported. In exchange, Ellis was barred from discussing his retirement with anyone except his attorneys and financial advisors. He also agreed to not criticize Kroger or any Kroger employees in the future, or disclose any company trade secrets.
Non-disclosure, non-disparagement agreements are fairly standard, but Ellis' separation agreement may be evidence of a less-than-friendly departure, said Robert Rasmussen, a corporate law professor at the University of Southern California, according to Cincinnati Enquirer.
In June, Kroger said Ellis retired due to "personal reasons," citing the fact that his family remained in Portland, Oregon, while he was based in Ohio for the past several years.
Following the SEC filing, a Kroger spokesperson said, "This filing reflects the terms of (Ellis') voluntary departure. Mike retired after 40 years with Kroger and we continue to wish him all the best."
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