Tuesday, March 23, 2010

PBS&J in turmoil?

Hot on the heels of last week's news that PBS&J's former CEO John Zumwalt is about to receive more than $2.3 million in payments and benefits comes news that the company may be up for sale.

Zumwalt announced last month that he would resign as CEO and also step down as chairman of the company's board of directors after PBS&J's employee-owners rejected his re-election to the board at the company's annual meeting, according to a Tampa Bay Business Journal article.

The biggest chunk of the separation agreement is a $900,000 transition payment. PBS&J will make that payment to Zumwalt in 24 monthly installments, according to a filing with the Securities and Exchange Commission.

The company will also pay Zumwalt a $330,000 severance payment, payable in a lump sum. The restricted stock he holds will vest immediately and the shares of common stocks he owns in a 401(k) will be redeemed during the next open trading window, the filing said.

In addition, Zumwalt will get $946,824, the value of the accumulated benefits payable to him under the company's key employee capital accumulation plan and $16,003as compensation for accrued but unused paid time off, the filing said. He will be reimbursed $20,000 for legal fees incurred with negotiation and review of the agreement.

He agreed to make himself available to consult with the company for three months in return for a $135,000 consulting fee. If the company needs his consulting services after three months, he'll get a per diem payment of $3,000 per day.

In return, Zumwalt agreed not to compete against PBS&J for two years.

Zumwalt resigned in the midst of an internal investigation at PBSJ Corporation into alleged violation of the Foreign Corrupt Practice Act. The internal probe is focused on the PBS&J International Inc. subsidiary. Zumwalt served as president of the international subsidiary until July, according to the article.

Meanwhile, a St. Petersburg (Florida) Times article that came out this morning claims that the employee-owned firm has stopped workers from buying or selling company stock while it considers overtures from outsiders.

Investors and competitors have expressed preliminary interest in buying a stake in PBSJ Corporation or acquiring the company, chairman Robert Paulsen wrote in an e-mail to employees last week. The company has signed nondisclosure agreements with potential suitors and can't say if negotiations are taking place or with whom, he wrote.

Securities laws prohibit companies from engaging in stock transactions without disclosing information that could influence an investor's decisions to buy or sell the stock.

Employees holding more than 20 percent of PBSJ shares indicated they wanted to sell their shares when the annual "window" for stock transactions was scheduled to open March 17.

Stay tuned.

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