Yahoo has introduced two new severance plans that will protect its employees if Microsoft's unsolicited takeover bid is successful, it said in filings with the U.S. Securities and Exchange Commission (SEC) on Tuesday.
The new plans filed make all full-time employees eligible for severance pay equal to base salary for four months to 24 months, depending on the employee's job level. Health and dental coverage is also included.
The maximum protection of 24 months' salary will be offered to CEO Jerry Yang, Chief Financial Officer Blake Jorgensen, and certain other executives still employed by the company and named in the SEC proxy filing for Yahoo's 2007 annual general meeting. That list includes former CFO Susan Decker, now president of the company,
and Executive Vice President, General Counsel and Secretary Michael Callahan. Others listed in the proxy filing have already left the company, including former Chairman Terry Semel, former Chief Operating Officer Daniel Rosensweig and former Chief Technology Officer Farzad Nazem.
The benefits take effect if an employee's contract is terminated without cause by Microsoft -- or another acquirer -- or if the employee leaves with good reason within two years of a change of ownership.
The severance plans are designed to help retain employees, help maintain a stable work environment and provide certain economic benefits to the employees in the event their employment is terminated, according to Yahoo.
Yahoo's filing came the same day that news reports suggested Microsoft is preparing a campaign to win shareholder support for changes to Yahoo's board.