Yahoo Chairman and Chief Executive Terry Semel received a 2006 bonus of $25.7 million in stock, or 80 percent of his potential payout and a 52 percent drop from his 2005 compensation, the company said Friday.
In a filing with the U.S. Securities and Exchange Commission, the Internet media company said the compensation committee of its board of directors had granted Semel 800,000 shares out of a potential 2006 year bonus of 1 million shares.
Terry Semel
The 2006 bonus represents 60 percent of the roughly 1.3 million share bonus Semel was awarded in 2005, Yahoo spokeswoman Helena Maus said.
With an exercise price of $40.68, his 2005 bonus was worth nearly $52.9 million. Semel was also paid a salary of $600,000 during 2005.
Yahoo stock in 2005 rose 4 percent, outpacing major indexes.
Last year, its shares fell 35 percent to $25.54 amid weakness in some key advertising markets, a shift in audience to new social-networking sites and competitive challenges from rival Google.
Semel acknowledged that he was unhappy with the financial performance of Yahoo, and he undertook a management reorganization late in 2006.
Under a three-year executive performance and retention plan announced in May 2006, Semel receives $1 in annual pay each year, plus up to 1 million in fully vested shares of Yahoo stock at the discretion of the board's compensation committee.
The stock option has an exercise price of $32.12, which was the closing trading price of Yahoo's common stock last Monday, the day of the grant. He has seven years to exercise the grant.
In the first two months of 2007, shares of Yahoo gained 19 percent, buoyed by anticipation of the introduction of a more competitive advertising system.
A former Hollywood movie mogul turned Internet investor, Semel took over as Yahoo's top executive six years ago.
