Yahoo Claims 'Cause' in CEO Scott Thompson Departure (Report)
Yahoo is claiming "cause" in CEO Scott Thompson's resignation amid the controversy over his resume, All Things D reports.
According to the tech news website, that means the company won't be oligated to pay Thompson the giant severance typically relegated for high-level executives. The "cause" claim was outlined in Thompson's January offer letter, which explained the course of action should he depart under sunnier, "without cause" conditions.
“If Mr. Thompson’s employment is terminated by the Company without cause or by Mr. Thompson for good reason, the Company will offer him severance benefits similar to the benefits it provides to other senior executives of the Company at the time of his termination,” says the Securities and Exchange Commission-filed employment agreement, via All Things D.
“In addition, if Mr. Thompson’s employment is terminated by the Company without cause, by Mr. Thompson for good reason, or due to Mr. Thompson’s death or disability, the Make-Whole RSUs that are then outstanding and unvested will fully vest upon his termination," it reads.
The Make-Whole RSUs, or restricted stock units, were valued at $6.5 million and related to Thompson's tenure as president of eBay's PayPal payments division branch.
But here's the rub: Thompson's offer letter also has a clause called "Code of Ethics and Yahoo! Policies," allowing Yahoo to forgo a payout to Thompson.“Yahoo! is committed to creating a positive work environment and conducting business ethically," the agreement begins.
Thompson resigned Sunday amid headlines -- and a company investigation -- related to a fake computer science degree on his resume. He was replaced by Ross Levinsohn as interim CEO, and there were changes on the board as well: Fred Amoroso became chairman and said Yahoo has reached an agreement with a dissident shareholder.
Amoroso replaces Roy Bostock, who has stepped down from his role as non-executive chairman "to accelerate the leadership transition for the new board," Yahoo said.