On Friday, Yahoo"s board of directors have brought Chairman and CEO Terry Semel"s annual salary to one dollar! This is done while boosting overall future compensation through stock options and grants. In a filing
with the U.S. Securities and Exchange Commission on Friday, Yahoo said
its board had approved two days before a long-term executive retention
plan where Semel will receive $1 for each of the next three years
through 2008.
His salary in each of the past three years was $600,000.
Yahoo is not unique among Silicon Valley companies in
deemphasizing salary and linking compensation to company performance in
the form of share bonuses. Since 2004, Google Inc., Yahoo"s
biggest rival, has paid $1 in salary to its top executives --
co-founders Larry Page and Sergey Brin and CEO Eric Schmidt --
compensating the three billionaires instead through stock options and
grants.
The world"s largest Internet media company said Semel
stands to benefit from a discretionary bonus in the form of a fully
vested stock option of up to 1 million shares a year, priced at Yahoo"s
closing trading price the day of the grant. The actual amount of the bonus will be based annually on the performance of the company and be approved by the board.
As
a retention incentive, the board granted Semel a stock option to buy 6
million shares of Yahoo"s common stock at an exercise price of $31.59
per share, the closing price of the company"s common stock on May 31,
the date of the grant.