Executives who will take over as CEOs after eBay breaks up into two publicly-traded companies next year will be well compensated, according to filings with the SEC. eBay announced the breakup on Tuesday and said current eBay Inc. CEO John Donahoe would step down after overseeing the split.
Dan Schulman was named President of PayPal on Tuesday. Filings show he earns an annual base salary of $900,000 with a target bonus of 175% of his base salary. After the spin-off, his salary will increase to $1 million with a target bonus of 200% of his new base salary.
eBay also promised Schulman it would “make good” on certain compensation he would have earned had he stayed with his previous employer, American Express “to make him whole.” The Wall Street Journal did the math and summarized Schulman’s compensation beyond his base salary as: $18 million in equity awards over the next year, and “as much as $29.1 million in pay for benefits he is possibly forfeiting from his former job at American Express Co.” You can find the details on the SEC website.
The filing also show he will be covered by its generous relocation assistance program that includes compensation for temporary housing and travel-related expenses. And unless he is terminated with cause or leaves for anything other than a “good reason,” he’ll receive a generous severance package that includes a lump sum cash payment equal to two times the sum of his annual base salary plus his target annual bonus in addition to other compensation.
Devin Wenig, who is currently President of eBay Marketplaces, will become the CEO of eBay after the split. He will receive “all of the same compensation and benefits, on all of the same terms and conditions, to which Mr. Schulman is entitled to” except any Make-good Awards or Relocation Benefits and a few differences.
The Wall Street Journal summarized Wenig’s compensation package: “his base salary will rise to $900,000, from $800,000, and will jump to $1 million following the split. He too is eligible for bonus payments of as much as $1.68 million before the breakup and $2 million following, eBay said. Mr. Wenig will be eligible for restricted stock units and options of as much as $4 million.”
So how do those figures compare to that of the current CEO of eBay Inc.? Last year, John Donahoe raked in nearly $14 million in salary, stock and cash incentive payouts. But that was less than half of what Donahoe took home in 2012, when he netted $29.7 million, about half of which was tied to a one-time performance bonus.