Macy’s New Legal Chief Collects $1.5 Million Amid Takeover Fight

Macy’s Inc. paid chief legal officer Tracy Preston more than $1.5 million after announcing her hire in December, five days before an investor group’s offer to take the company private was publicized.

The department store operator gave Preston $49,900 in salary, $10,200 for relocation costs, and $630,000 in stock awards, a company proxy statement shows. It also awarded an $840,000 signing bonus during fiscal 2023 to “offset awards” forfeited at Preston’s previous employer, HanesBrands Inc.

Macy’s announced Preston’s hire Dec. 5, stating it was effective Jan. 8 of this year. On Dec. 10, the Wall Street Journal first reported that the New York-based company had received a $5.8 billion buyout offer from Arkhouse Management Co. and Brigade Capital Management LP.

The retailer rejected that bid but agreed last week to name two directors nominated by Arkhouse to its board. Macy’s has said it will continue to engage with Arkhouse and Brigade over their effort to acquire the company.

Preston, who is also corporate secretary at the company, and Macy’s didn’t respond to comment requests.

Going forward, Preston, 57, will be eligible for a target compensation package valued at almost $2.6 million, according to the proxy filed by Macy’s. The package consists of a $775,000 annual base salary and $1.2 million in long-term incentive awards of time- and performance-based restricted stock units.

Preston, who this year is board chair for the Association of Corporate Counsel, will see 50% of her new equity awards vest on the second and third anniversaries of their grant date, Macy’s said.

She owns $740,000 in HanesBrands stock, Bloomberg data shows. HanesBrands hired her in 2021 after Preston spent almost a decade as legal chief for luxury retailer Neiman Marcus Group Inc.

Preston’s predecessor as the top lawyer at Macy’s, the recently retired Elisa Garcia, 66, received more than $2 million in total compensation last year, per the company’s most recent proxy. Garcia joined Macy’s in 2016 after running the in-house legal teams at Office Depot Inc. and Domino’s Pizza Inc.

Wachtell, Lipton, Rosen & Katz corporate partners David Katz and Elina Tetelbaum counseled Macy’s on its proxy fight with Arkhouse, along with associates Raeesa Munshi, Mark Andriola, and Ibitayo “Tayo” Awoyinfa.

Cadwalader, Wickersham & Taft Arkhouse advised Arkhouse, while Paul, Weiss, Rifkind, Wharton & Garrison represented the overall buyer group. That group in an April 10 statement said it looks forward to working with Macy’s and its board to “unlock shareholder value.”

Wendy Schmidt Beadles, a veteran in-house lawyer at Macy’s who served as interim legal chief after Garcia retired in October, is now its vice president of legal operations. HanesBrands tapped its chief human resources officer, former Walmart Inc. lawyer Kristin Oliver, to be its interim legal chief after Preston left the company earlier this year.