Former Great Canadian Gaming Corp. CEO Rod Baker.Great Canadian Gaming
Rod Baker, who stepped down as CEO of Great Canadian Gaming Corp. on Monday, has ample resources to cover his $575 fine for breaking COVID-19 protocols: Stock records show he made a $45.9-million profit on stock options over the past 13 months, and he’s due to receive another $28-million when the company is sold to a U.S. buyer this year.
Mr. Baker resigned from the company after Yukon officials charged him and his wife on Jan. 21 under the territory’s Civil Emergency Measures Act. The Vancouver couple allegedly chartered a flight, went to the small community of Beaver Creek and represented themselves as local hotel workers in order to receive the COVID-19 vaccine.
In its Monday announcement of his departure, the Toronto-based gambling and entertainment company said its board of directors “has accepted Rod Baker’s resignation” effective Sunday. It did not address any potential severance. The company did not immediately respond to compensation-related questions on Tuesday.
According to Great Canadian Gaming’s past disclosures, Mr. Baker is eligible for severance if he resigns for “good reason” – which means, for example, he is demoted, gets a pay cut or has important duties taken away, including after a merger or organizational change. The company estimated it would pay Mr. Baker $4.3-million in cash severance, based on his salary and recent bonuses, according to its calculation at the end of 2019, the most recent disclosure available.
However, Mr. Baker was planning to continue as chief executive after Apollo Global Management Inc. closes its deal to purchase the company, and was in line to receive a $6-million cash long-term incentive payment in 2023 for staying on for three years.
Despite departing prior to that payout, he will continue to make millions from his Great Canadian Gaming stock options.
Mr. Baker stands to receive more than $28-million in cash from Apollo in payments for his stock and share options when the purchase closes. Great Canadian Gaming awarded Mr. Baker 1.54 million stock options over a 10-month period in 2017 and 2018, in part as a reward for the company getting a contract in the Toronto area. Mr. Baker’s options are worth $24.6-million at Apollo’s $45 takeout price for the company. He also owns $3.4-million in company stock outright.
The deal is expected to close in the second quarter.
When companies give out stock options and other share awards as compensation, they have a “vesting” schedule so that the recipient stays with the company and works to deliver longer-term results. Typically, when an executive departs unexpectedly, the question is whether the executive can still exercise options and other stock awards that haven’t yet vested.
All of Mr. Baker’s options have vested, however, meaning he can exercise them at any time.
Company disclosures also say that upon a resignation for “good reason,” Mr. Baker can keep 14,906 shares of restricted stock for which Apollo was to pay him about $671,000.
Mr. Baker earned total compensation of $10.6-million in 2019, according to the most recent available disclosure. That included a $900,000 annual salary and stock options valued at $9.2-million. However, in 2020, the company cancelled the options, which had exercise prices at or above the initial Apollo offer for the company.
On each of the past two New Year’s Eves, stock records show, Mr. Baker exercised his older stock options for millions in profits. On Dec. 31, 2019, he exercised 950,630 options for a profit of $34.9-million. On Dec. 31, 2020, he exercised 500,000 options for a profit of $11-million.
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David Milstead