Chiquita, or Chiquita Brands International, announced a plan to reimburse employees for certain costs of employees that were relocated when Chiquita moved its headquarters from its long time home in Cincinnati, Ohio to Charlotte, North Carolina. The package will include payments in relation to the cost of moving into the new homes and then covering the difference for any loss incurred due to selling their homes in Cincinnati.
The relocation benefit plan was laid out in a securities note and covers all the executive officers with the sole exception of CEO Fernando Aguirre. The package covers the cost for the following related expenses from the relocation: The cost of searching for a new home, the rent for temporary housing needed through the moving process, storage costs, closing cost for selling the home, commission cost for selling the home, inspection costs associated with selling the old home, up to $125,000 on any loss incurred on the sale of the old home, packing and moving expenses, cover for income taxes related to the moving expense, and they would arrange for a third party to sell the old home.
Large companies that uproot their employees do often times offer similar relocation packages. With the housing market being near all time lows, Chiquita has also been generous in offering compensation for any loss incurred on the sale of the old homes. Part of the deal does include however, a forfeit line. If the executive does not stay with Chiquita for at least 12 months after the move, Chiquita is to be reimbursed for the costs.
Also included in this deal is an array of severance packages for employees. Any employee that was not offered to move to Charlotte with the company will be compensated, and any executive offered to move but is unable or unwilling will also be compensated.
Why did Chiquita Leave Cincinnati?
Chiquita decided to move to Charlotte in November after agreeing to a significant $22 million deal. The sate offered Chiquita $20 million in incentives and the two local counties also both offered $1 million. North Carolina Governor Bev Perdue has stated that it is his goal to transform the state into a state of innovation, and bringing in Chiquita is a good first step.
Cincinnati has been addressing a rising concern of businesses leaving or having incentives to relocate the city recently. The Banks renewal project is being hailed as an effort to make the city more tempting for businesses to operate in the city that is already known worldwide for its large banking and consumer goods development industry. Corporate deals were offered to Chiquita to stay, but the Charlotte offer was too enticing.
The move is also expected to create around 400 jobs in North Carolina, with an average pay of $107,000. Chiquita has also already pledged to donate salad bars to local schools in an effort to promote the brand and offer healthy and fresh food to the community.
The move of employees is expected to start in the summer of this year.