this week, former Yahoo CEO Carol Bartz announced that Yahoo’s Chairman of the
her over the phone. This action didn't seem entirely too shocking to many,
as Bartz made
enemies on Wall Street while serving as Yahoo's CEO.
Bartz was relieved of her duties with 16 months left of the four-year contract
that she signed back in January 2009. She released an email to Yahoo employees
this week informing them of what had happened and that she wishes "only
the best going forward."
Now, Bartz is moving forward herself -- with a hefty
severance package that will leave her with millions of dollars.
According to Yahoo, Bartz was fired "without cause," which gives her
a healthy severance that consists of both cash and millions of dollars attached
to Yahoo's stock performance within the next year.
As far as the cash goes, Bartz's contract gives her $3 million, plus a
pro-rated 2011 bonus of $1 million to $2 million.
The stock is where the real money comes in, though. In Yahoo's latest
regulatory filing on executive compensation, the company estimated that Bartz
would have collected $5.2 million in stock payouts if she were fired December
31, 2010. Both cash and stock would have added up to $10.4 million if she were terminated on or before the
final day of the company's latest fiscal year.
But Yahoo hasn't updated its filings yet to show how much she'll collect for
her actual termination date. It's looking good for Bartz though, since she has
a series of stock grants that cash out immediately upon termination, and also
received a complex stock option package when she first signed on that gives her
up to $5 million shares at a "strike price" of $11.73 (Yahoo's closing
price January 30, 2009).
Bartz could collect a majority of those shares based on the length of her
service, but they'll only vest if Yahoo's
stock hits between $17.60 and $35.19. The deciding day will come
in December 2012, and is Yahoo's share price is trading "in the
money" at that point in time, Bartz will receive her payoff.
Timothy Morse has been chosen by the Yahoo Board of Directors as the interim
Chief Executive Officer to replace Bartz.