Yahoo 2007 Annual Report Download - page 138

Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards — Fiscal 2007
Table
Employment Agreements
In May 2007, the Company entered into an employment letter agreement with Mr. Jorgensen, our Chief
Financial Officer. The agreement provided for an initial annual base salary of $450,000, subject to annual review,
and a target annual cash bonus equal to 100% of his base salary. The agreement is for at-will employment and does
not provide a specified term.
In October 2004, the Company entered into an employment letter agreement with Mr. Murray, our Chief
Accounting Officer. The agreement provided for an initial annual base salary of $325,000, subject to annual review,
and provides that Mr. Murray’s eligibility to participate in the Company’s incentive bonus plans is also subject to
annual review. The agreement is for at-will employment and does not provide a specified term.
Equity-Based Awards
Each of the equity-based awards reported in the Grants of Plan-Based Awards — Fiscal 2007 table was granted
under, and is subject to, the terms of our 1995 Stock Plan. The 1995 Stock Plan is administered by the
Compensation Committee. The Compensation Committee has authority to interpret the plan provisions and
make all required determinations under the plans. This authority includes making required proportionate
adjustments to outstanding awards upon the occurrence of certain corporate events such as reorganizations,
mergers and stock splits, and making provision to ensure that any tax withholding obligations incurred in respect of
awards are satisfied. Awards granted under the plan are generally only transferable to a beneficiary of a Named
Executive Officer upon his or her death. However, the Compensation Committee may establish procedures for the
transfer of awards to other persons or entities, provided that such transfers comply with applicable securities laws.
Under the terms of the 1995 Stock Plan, if there is a change in control of Yahoo!, each Named Executive
Officer’s outstanding awards granted under the plan will generally be assumed by the successor company, unless the
Compensation Committee provides that the award will not be assumed and will become fully vested and, in the case
of options, exercisable. Any options that are vested at the time of the change in control (including options that
become vested in connection with the change in control) generally must be exercised within 30 days after the
optionee receives notice of the acceleration.
Stock Options. As described in the “Compensation Discussion and Analysis” above, Ms. Decker and
Messrs. Jorgensen, Callahan and Murray were each granted stock options as retention incentives in 2007. The
option granted to Ms. Decker in November 2007 covers 300,000 shares of our common stock and, according to the
terms of the grant, vests over a three-year period, with 150,000, 75,000 and 75,000 shares, respectively, vesting on
each of October 15, 2008, October 15, 2009 and October 15, 2010. Subject to earlier termination of the option, the
option will generally remain exercisable for 12 months following the termination of Ms. Decker’s employment with
the Company.
The options granted to Messrs. Callahan and Murray in February 2007 cover 150,000 shares and 75,000 shares
of our common stock, respectively, and are scheduled to vest 100% on the fourth anniversary of the grant date. The
option granted to Mr. Jorgensen in July 2007 in connection with his commencing employment with the Company
covers 425,000 shares of our common stock and is scheduled to vest 25% on the first anniversary of the grant date,
with the remainder being scheduled to vest in six equal semi-annual installments over the three-year period
thereafter. Finally, the options granted to Messrs. Jorgensen, Callahan and Murray in August 2007 cover 50,000,
150,000 and 40,000 shares of our common stock, respectively, and are scheduled to vest in equal installments on
each of the first four anniversaries of the grant date.
The Grants of Plan-Based Awards — Fiscal 2007 table above also reflects the fully-vested option to purchase
800,000 shares of our common stock awarded to Mr. Semel in February 2007 in respect of his 2006 bonus. Subject
to the earlier expiration of the stock option, the option will generally remain exercisable following the termination
of Mr. Semel’s employment for a period of three years.
Each of the options granted to Named Executive Officers during 2007 has a per-share exercise price equal to
the closing price of our common stock on the grant date and a maximum term of seven years. These options do not
include any dividend rights.
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