Math geek Marissa Mayer should appreciate her new salary as CEO of Yahoo; the base pay of $ 1 million a year works out to $ 83,333.33 a month. But that’s just a small part of an initial package potentially worth more than $ 60 million if she stays through 2017 or is fired without cause. The odds of the former are against her: the former Google product exec is the third Yahoo CEO in less than a year and the fifth in five years.
The at-will employment letter filed with the SEC Thursday (embedded below) isn’t a contract with an end date but bonus and stock compensation is based on Mayer being at Yahoo for five years. The total doesn’t include annual awards made after 2012, which would kick the value up by tens of millions of dollars if she lasts. Mayer was employer #20 at Google and was with the search company for 13 years before her surprise leap to Yahoo Monday. She was one of the Googlers who struck it rich with the IPO.
In addition to base salary, the package also includes:
- A pro-rated target incentive of up to 400 percent for 2012. The annual executive target plan is 200 percent
- $ 12 million in restricted stock units (RSUs)and stock options for 2012, vesting over 30 months.
- $ 14 million in restricted stock units vesting through 2014: $ 4 million in 2012, $ 7 million in 2013 and $ 3 million in 2014. This is to help compensate her for compensation she gave up at Google, similar to a payment Scott Thompson, the last CEO, received for leaving his package at PayPal behind.
- A $ 30 million retention equity award in RSUs and stock options that vests in equal parts through 2017.
- $ 50,000 a year for security.
Mayer also has permission to continue as a Walmart board member “so long as it does not create competitive or fiduciary conflicts.”
Her first day at Yahoo was July 17; her first payday is July 25.
Update: Eric Jackson rightly points out that Mayer’s compensation potential is nowhere close to the packages some of her predecessors received.
Marissa’s not getting Semel-money
— Eric Jackson (@ericjackson) July 19, 2012
Perspective, people: Semel got $ 600m for 6 years at $ YHOO
— Eric Jackson (@ericjackson) July 19, 2012
More perspective: Carol Bartz got a total 4 year comp package worth $ 187mm: bit.ly/O0KKgH So $ YHOO board getting more hard-nosed…
— Eric Jackson (@ericjackson) July 19, 2012
Bartz received more than $ 47 million in compensation the first year and left two-and-a-half years in with a $ 14 million severance payout.
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