April 15, 2003 6:55 PM PDT
Yahoo's Koogle leaving board
Yahoo announced Tuesday that Koogle will be replaced in May by advertising executive Roy Bostock, leaving cofounder Jerry Yang as the only board member who was with the company when it emerged in the mid-1990s and became a Web powerhouse.
The search portal on Tuesday also filed its annual proxy, which covers executive compensation. Semel, a former entertainment studio chief, last year received a 45 percent salary increase and a 200 percent bonus.
Yahoo's board has changed dramatically in the two years since Semel was named CEO in April 2001.
The company added former Walt Disney Company Chief Financial Officer Gary Wilson and Yucaipa Companies founder Ron Burkle in November 2001, increasing the size of the board to nine members.
Former founding investor Michael Moritz resigned earlier this year and was replaced by Robert Kotick, chief executive of Activision. Bostock, who has been nominated to replace Koogle, is chairman emeritus of BCom3 Group. All told, five of the nine board members have joined Yahoo during Semel's reign.
"We have focused intently on ensuring that (Yahoo's board of) directors represents an increasingly broad range of experience relevant to Yahoo's core business and that it maintains a strong majority of independent directors," Semel said in a statement.
Although it's not uncommon to see the makeup of a board shift after a new CEO arrives, the process often takes three or four years, said Jon Holman, who heads the executive search firm The Holman Group.
Yahoo's nine directors will be up for election at the company's annual shareholder meeting in May, according to the proxy.
The filing also outlined Semel's compensation package. Last year, he received a salary of $450,000, reflecting a 45 percent increase from his base salary of $310,000, as specified in his employment contract. But a larger portion of Semel's compensation came from a $895,500 bonus, according to the filing.
"For a company of Yahoo's size, CEOs tend to make a salary of $1 million or so," Holman said. ?He's underpaid on the salary, but he made up for it with his bonus. It's unusual to see a bonus that is two times salary."
Semel also received 2.8 million stock options, with roughly two-thirds of the options carrying a strike price of $12.92 and the remaining shares having an exercise price of $16.46. Yahoo's shares closed Tuesday at $24.81.
Yahoo's compensation committee for the board of directors noted Semel's pay was below the going rate, according to surveys the committee reviewed. The committee said his bonus was for completing a number of significant strategic alliances last year, as well as redefining the company's services and products.