Radio Shack CEOAgreesto Resign from newpaper PDF

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RadioShack CEO Agrees to Resign Edmondson to Get Severance Of About $1.5 Million After Résumé Controversy By GARY MCWILLIAMS February 21, 2006

http://online.wsj.com/article/SB114046886235578393.html RadioShack Corp. Chief Executive David Edmondson -- who admitted inflating his educational background -- yesterday resigned by "mutual agreement," and the electronics retailer launched a search for a new CEO. The Fort Worth, Texas, company named Claire Babrowski -- its executive vice president and chief operating officer -- president and acting CEO. Ms. Babrowski, 48 years old, joined the firm last June after 30 years at McDonald's Corp. RadioShack hired executivesearch firm Spencer Stuart to conduct a search for a permanent successor. The company said Ms. Babrowski is a candidate for the job. Mr. Edmondson said in a statement released by the company: "The board and I have agreed that it is in the best interest of the company for new leadership to step forward." He will receive a severance package valued at about $1.5 million, said Leonard H. Roberts, the company's executive chairman. The management turmoil comes at a difficult time for RadioShack, which faces slack cellphone sales. The company on Friday announced plans to close as many as 700 stores and take a large write-down. Its shares fell $1.67, or 8.1%, to $19.08 in 4 p.m. New York Stock Exchange composite trading Friday after hitting a 52-week low of $18.80 earlier that day. Last week, Mr. Edmondson acknowledged misstating his educational credentials, saying he believed he received a ThG diploma -- typically a certificate with fewer requirements than a bachelor's degree -- and not a bachelor of science degree as he previously claimed. But the 46-year-old CEO also acknowledged he couldn't document the ThG diploma. Mr. Edmondson is awaiting trial on a charge of driving while intoxicated, his third DWI charge in 17 years. The first two didn't result in convictions, although one, in July 2000, resulted in a type of probation. Mr. Roberts said yesterday that after the board had publicly backed Mr. Edmondson, it launched its own inquiry. He said the company checked Mr. Edmondson's references when he joined the company in 1994. But he added, "We weren't checking educational credentials. Today we do." He said the probe uncovered information the company hadn't known when it publicly supported Mr. Edmondson last week, though he declined to be specific. "What we thought we knew then, we did not know. In retrospect, I wish we didn't make that statement. Because obviously we didn't know all the facts," Mr. Roberts said.

Mr. Edmondson couldn't immediately be reached, and the company declined to make him available for comment. Mr. Roberts defended his naming of Mr. Edmondson as CEO after 11 years in various RadioShack management posts. Nearly a dozen years ago, Mr. Roberts met with Mr. Edmondson, who had written Mr. Roberts suggesting marketing ideas for the company. Mr. Roberts was so impressed that he later recruited Mr. Edmondson to join the retailer. The company's profit for the quarter ended Dec. 31 plummeted 62% to $49.5 million, or 36 cents a share, from $130.9 million, or 81 cents a share, in the year-earlier quarter. Revenue rose 4.9% to $1.67 billion. Write to Gary McWilliams at [email protected]...