Siebel Systems Inc. will pay new chief executive officer George Shaheen an annual salary of US$1 million, under an employment agreement substantially the same as the one it signed a year ago with deposed CEO Mike Lawrie.
Shaheen’s agreement with the San Mateo, Calif., software maker entitles him to options on two million shares of company stock, with a five-year vesting schedule and a strike price set at the market value of Siebel’s shares on the date of the options grant. Shaheen will also receive 350,000 shares of restricted company stock, 150,000 of which vest June 30. The remaining portion will vest in two years.
Siebel’s shares (SEBL) closed trading Monday on the Nasdaq exchange at US$8.63, valuing Shaheen’s stock grant at US$3 million.
Shaheen is also eligible for a target bonus of 125 per cent of his base salary, which Siebel’s board can increase to 200 per cent if it judges he has “substantially exceeded” goals.
Lawrie received the same salary, options and stock grant as Shaheen, according to a copy of his offer letter that Siebel included in regulatory filings. In the event of Lawrie’s termination, his agreement called for him to receive two years’ target salary and bonus — a payout of US$4.5 million — along with termination of restrictions on his stock grant and immediate vesting of 40 per cent of his two-million-shares option grant.
Siebel’s shares have sunk since Lawrie was named Siebel’s CEO on May 3, 2004. They ended trading that day, before the announcement of Lawrie’s appointment, at US10.62.