eBay CEO John Donahoe received $14 million in total compensation (including salary, bonus, stock, options) in 2014, up 1.6% from 2013, while CFO Bob Swan received compensation totaling $7.7 million in 2014, down 2.9% from the previous year. Among the perks received by the top two executives was personal use of the corporate jet, valued at $76,524 for Donahoe, and $64,263 for Swan.
The pair, along with other top level executives who are not going to either company (eBay or PayPal) after the split, will receive bonuses under a “golden handshake” provision entitled the Transaction Success and Retention Program. Donahoe will receive $23 million and Swan will receive $12 million.
eBay Marketplaces President Devin Wenig received $10.5 million in total compensation in 2014 – a 57% increase. He received a raise in 2014 thanks to his new colleague, PayPal President Dan Schulman, as we’ll explain. The company’s Board of Directors went into great detail about how it made this and other decisions about executive compensation in a letter to shareholders included in its annual Proxy filing with the SEC.
eBay hired Schulman last year to head PayPal, and once the breakup of eBay and PayPal is complete in the second half of this year, he will become CEO of the new publicly traded PayPal. (We reported on his compensation package in October.)
The board’s compensation committee explained that since Wenig is also CEO-designee of eBay, it determined the two executives’ compensation arrangements should be equivalent “because eBay and PayPal would each be large, public companies in the Internet and technology space following the Spin-Off.”
Wenig’s salary increased from $800,000 to $900,000 on September 30, 2014 “in connection with becoming CEO-designee of eBay,” and it will rise again, to $1 million, effective immediately following the spin-off, at which point his target cash Incentive Award will rise from 175% of annual salary to 200% following the spin-off.
The board praised Donahoe and his corporate leadership team. It said the priorities of the current executive management team expanded to include not only delivering business results for the company, but also the work of creating a transition plan. “The compensation programs for late 2014 and 2015 reflect those priorities,” it told shareholders.
During this important transition period in the Company’s history, the Board extends its heartfelt thanks and deep appreciation to Mr. Donahoe and his corporate leadership team, which has worked together since Mr. Donahoe became CEO in 2008. This team led the strategy work that resulted in the Board deciding to separate eBay and PayPal. The decision by Mr. Donahoe and his team to not place themselves in operating roles in either of the new companies has enabled a highly effective separation process and smooth management succession plan. The team’s decisions and actions on behalf of eBay, PayPal, and the Company’s stockholders give the Board great confidence in its decision, the overall separation process and the future success of eBay and PayPal.
The board also gave the two CEO designates “golden parachute” provisions. Schulman will receive $20.2 million if he is terminated “other than for cause,” while Wenig will receive $22.5 million as part of the involuntary termination provision.
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