May 26, 2005 5:12 PM PDT
Siebel discloses employee retention program
In a regulatory filing Thursday, Siebel said the compensation committee of its board has approved the adoption of an employee retention benefit program. The program, which involves separate plans for employees at various levels, comes amid speculation the company might be sold.
"Recent rumors concerning potential acquisitions or takeovers of the company have created a great deal of uncertainty among the company's employees and executives, which could negatively impact employee productivity and company performance," Siebel said in its filing.
Under the plans, eligible employees will receive certain severance benefits during the period that begins three months before a change of control and ends one year following a change of control. The plans cover involuntary terminations "without cause" and voluntary resignations "for good reason," according to the filing.
Profits and sales have declined in recent years at Siebel, which provides software for helping companies with customer relationship management, or CRM. The company has had to contend with competition from enterprise software giant SAP and the rise of Salesforce.com, which made its mark by offering CRM as a hosted service over the Internet.
In its filing Thursday, Siebel said the compensation committee approved the adoption of the employee retention benefit program on May 20. Siebel also said it "remains entirely focused on growing its business, generating profit, adding customer value and serving the long-term interests of its customers, employees and stockholders."
The company is under increasing pressure as it heads toward its annual shareholder meeting June 8. A number of investors are calling for the company to take some action to maximize their investments--from selling the company to taking it private. Some have mentioned the possibility of a proxy fight.
"I'd like to see the company sold," said Barry Rosenstein, chief investment officer of Jana Partners, a vocal critic and a recent investor in the company. "I think Siebel would get the highest value if it were acquired by a strategic buyer."
Earlier this month, Siebel's newly appointed chief executive, George Shaheen, said that a bright future for the company lies ahead, and that getting there is a matter of becoming leaner, better organized and more focused on big market opportunities.
CNET News.com's Dawn Kawamoto contributed to this report.
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