Medicis CEO Shacknai's Contract Put Kids Ahead of Company

The likelihood of Valeant's (VRX) proposed takeover of Medicis (MRX) looks a whole lot different once you've read Medicis CEO Jonah Shacknai's employment agreement. It requires that he work only four days per week, that he be allowed to work from home, that charity functions be considered part of his work, and that he "may not be available for corporate matters during such times that he is providing care for his children."

The childcare terms are unusually generous, according to the Footnoted financial blog. Childcare was also an issue on Shacknai's Q2 conference call, in which Shacknai said he would return to work -- following the mysterious deaths of his 6-year-old son and 32-year-old girlfriend at their Coronado, Calif., mansion in July -- after his other two other children started school again in Arizona:

I expect very quickly to return to the normal work schedule at the office. School commences momentarily in Arizona. At this time, I've really been with the kids, waiting for school to begin. But as soon as that happens, I expect to be on my my normal calendar in the office doing all the things I have done previously.

Two other drug companies have been subjected to power struggles following the personal troubles of their CEOs recently. Cephalon was acquired by Teva (TEVA) after the death of its CEO, Frank Baldino Jr., who died in December. And Forest Labs (FRX) is fighting a proxy battle over control of its board of directors after the federal government said it might try to exclude CEO Howard Solomon from doing business with Medicare and Medicaid.

In other news, Radar reported that no suicide note was found near Rebecca Zahau Nalepa, Shacknai's girlfriend, who was found hanging nude from a balcony at his house July 13. The police investigation is expected to take several more weeks -- a time period in which Valeant clearly sees a weakened company with a distracted leader, ripe for the picking.

Updated Timeline of Deaths at Jonah Shacknai's Coronado Mansion:

• May 3: Coronado city council meets to approve architectural revisions to the historic house that have angered Shacknai's neighbors.
• June 10: Shacknai moves 123,222 stock options in MRX into an irrevocable trust for his children.
• June 24: Shacknai signs a renewed employment agreement featuring generous childcare terms.
• July 6: Shacknai nets $1.4 million exercising stock options.
• Prior to July 9: Jonah Shacknai reportedly planned to propose to Rebecca Zahau Nalepa
• Saturday/Sunday July 9 and 10: Zahau plans a party at the Shacknai house.
• Monday, July 11, morning: Jonah Shacknai's son, 6-year-old Max, falls down the stairs. Police say it is an accident. Max is found not breathing and without a pulse. He is taken to hospital where he is believed to be in a coma. Nalepa (who changed back to her maiden name, Zahau, in May) was looking after Max and a young girl aged 13 at the time. The girl is believed to be Rebecca's younger sister, and it is she, not Zahau, who called 911.* That afternoon: Zahau Nalepa asks Camp Diggity Dogs if her Weimaraner could be boarded following Max's accident. Her demeanor is "nice, polite, subdued and mellow." Jonah's brother Adam Shacknai reportedly arrives at the house after Max's fall.
• Tuesday, July 12: Zahau is seen sobbing and distraught at the kennels.
• That evening: A loud party or loud music is heard by neighbors of the house. Zahau is last seen alive Tuesday evening. She also talks to her sister on the phone as she gets ready for bed, sounding "normal."
• Wednesday July 13, 6.45 a.m.: Shacknai's brother, Adam, discovers Nalepa hanging naked from an outdoor balcony by her neck, with her hands and feet bound in orange cord. He calls 911. No suicide note is found. Adam and Nalepa are the only people on the property at the time, police said. Adam is currently not considered a suspect. Later, Jonah's ex-wife Dina Shacknai is reported to be "a witness in Zahau's death."
  That evening: defense attorney Paul Pfingst is retained to represent someone in the family.
• Thursday, July 14: Zahau Nalepa autopsy scheduled. Results not released.
• Sunday, July 17: Max dies in hospital.
• Monday July 18: Police launch investigation into Max's death. "Sexual accident" theory of Zahau Nalepa's death is ruled out by authorities. Max's autopsy scheduled for July 17 or 18. Shacknai hires Sitrick & Co. PR firm to represent him.