Wednesday, June 11, 2008
The Answers Yahoo Cannot Give
So Yahoo! Inc. posted the following FAQ on its internal intranet site for Yahoo! employees on June 10, 2008, explaining its position and thinking with regards to the 'Change in Control Employee Severance Plans' (Background info). I thought I'd add in my 2 cents to the answers, and say what Yahoo cannot say.
1. Why has Yahoo! instituted the Plan?
Yahoo Answer: Attracting and retaining talent has always been a top business priority for the company. We cannot execute against our big bets and ongoing priorities without an engaged and talented workforce. The Plan is intended to help us retain valued Yahoos during a period of uncertainty, maintain a stable work environment for our Yahoos and provide economic benefits to eligible employees in the event of potential job eliminations following a Change in Control.
My Answer: We cannot execute our big bets unless we retain control of the Board. The Plan is intended to help us retain control in the event of potential takeover attempts by Microsoft and/or the Icahn Group.
2. Why are you talking about severance packages when I’m still employed?
Yahoo's Answer: During a time of uncertainty, we understand the concerns of our Yahoos and we’re preparing for all potential scenarios. The Plan is intended to alleviate any concerns employees may have about a job loss in connection with a merger or other Change in Control.
My Answer: This isn't about your severance. Its about our severance. We're the ones in danger of being evicted. The Plan is intended to make sure that we still remain employed.
3. Does this mean Yahoo! will be acquired by Microsoft or another person?
Yahoo's Answer: No, this does not mean a Change in Control will necessarily happen. We want to alleviate concerns regarding a job loss in connection with a Change in Control if it should happen.
My Answer: No, we're doing everything we can to make sure it doesn't happen. But if it does happen, we want you to know that we did everything we could to make sure you got fired along with us.
4. Did Yahoo! adopt the Plan to thwart a deal with Microsoft? Does having a plan like this jeopardize a potential deal in any way?
Yahoo's Answer: No. The Plan is intended to help retain valued employees and preserve the value of Yahoo! during a period of uncertainty, without acting as a barrier to a Change in Control. We believe retaining valued Yahoos would be consistent with any acquiror’s goals.
My Answer: No, the Change in Control severance plan has nothing to do with any change in control. It all depends on what the meaning of 'change in control' is.
5. Is the Plan a “poison pill”?
Yahoo's Answer: No. The term “poison pill” is widely understood to refer to stockholder rights plans which work by allowing existing stockholders (except the acquiror) to buy more shares at a substantial discount to the then current share price of the target if the acquiror purchases above a specified level of stock of the target (usually 15%) without the consent of the target’s board. As a result, this substantially dilutes the acquiror’s holdings and makes the acquisition much more expensive. The Plan, which is designed to preserve the value of Yahoo! during a period of uncertainty, has no such purpose or effect.
My Answer: Well, come to think of it, Steve Ballmer did go kinda blue in the face when he first got to know about the pois... err... The severance plan. What's in a name anyway? Next question, please.
6. Mr. Icahn says this Plan costs $2.4 billion. Is that what it actually costs?
Yahoo's Answer: No. An estimate of the amount, if any, payable under the Plan requires making assumptions about unknown facts and variables including: (1) the number of employees who terminate employment without Cause or for Good Reason within the two years following any Change in Control, (2) each such employee’s job level and base salary, (3) the number of equity awards held by each such employee on their respective severance date, the portion of those awards that are not otherwise vested on that date, and the applicable exercise price of any option awards, (4) the market price of the Company’s common stock at the time such awards are ultimately exercised or paid, and (5) the length and level of reimbursement for health care benefits and outplacement services utilized by each such employee.
My Answer: Oh C'mon. Icahn doesn't know squat about anything. He's never run a real company in his lifetime. If he or Microsoft end up taking over Yahoo!, they'll have a lot bigger problems than worry about a lousy 500 million or so in severance payments. What happens when good severance packages are offered and new management takes over is that the good talented employees take up the offer, and the scum at the bottom of the barrel, like you, are left behind. Which means that Yahoo!, an internet company whose sole assets are the brand name and its human resources, will be left without any capable employees to stem the rot which is already destroying the brand. In other words, if either Microsoft or Icahn kick us out, we're taking all of you down with us.
1. Why has Yahoo! instituted the Plan?
Yahoo Answer: Attracting and retaining talent has always been a top business priority for the company. We cannot execute against our big bets and ongoing priorities without an engaged and talented workforce. The Plan is intended to help us retain valued Yahoos during a period of uncertainty, maintain a stable work environment for our Yahoos and provide economic benefits to eligible employees in the event of potential job eliminations following a Change in Control.
My Answer: We cannot execute our big bets unless we retain control of the Board. The Plan is intended to help us retain control in the event of potential takeover attempts by Microsoft and/or the Icahn Group.
2. Why are you talking about severance packages when I’m still employed?
Yahoo's Answer: During a time of uncertainty, we understand the concerns of our Yahoos and we’re preparing for all potential scenarios. The Plan is intended to alleviate any concerns employees may have about a job loss in connection with a merger or other Change in Control.
My Answer: This isn't about your severance. Its about our severance. We're the ones in danger of being evicted. The Plan is intended to make sure that we still remain employed.
3. Does this mean Yahoo! will be acquired by Microsoft or another person?
Yahoo's Answer: No, this does not mean a Change in Control will necessarily happen. We want to alleviate concerns regarding a job loss in connection with a Change in Control if it should happen.
My Answer: No, we're doing everything we can to make sure it doesn't happen. But if it does happen, we want you to know that we did everything we could to make sure you got fired along with us.
4. Did Yahoo! adopt the Plan to thwart a deal with Microsoft? Does having a plan like this jeopardize a potential deal in any way?
Yahoo's Answer: No. The Plan is intended to help retain valued employees and preserve the value of Yahoo! during a period of uncertainty, without acting as a barrier to a Change in Control. We believe retaining valued Yahoos would be consistent with any acquiror’s goals.
My Answer: No, the Change in Control severance plan has nothing to do with any change in control. It all depends on what the meaning of 'change in control' is.
5. Is the Plan a “poison pill”?
Yahoo's Answer: No. The term “poison pill” is widely understood to refer to stockholder rights plans which work by allowing existing stockholders (except the acquiror) to buy more shares at a substantial discount to the then current share price of the target if the acquiror purchases above a specified level of stock of the target (usually 15%) without the consent of the target’s board. As a result, this substantially dilutes the acquiror’s holdings and makes the acquisition much more expensive. The Plan, which is designed to preserve the value of Yahoo! during a period of uncertainty, has no such purpose or effect.
My Answer: Well, come to think of it, Steve Ballmer did go kinda blue in the face when he first got to know about the pois... err... The severance plan. What's in a name anyway? Next question, please.
6. Mr. Icahn says this Plan costs $2.4 billion. Is that what it actually costs?
Yahoo's Answer: No. An estimate of the amount, if any, payable under the Plan requires making assumptions about unknown facts and variables including: (1) the number of employees who terminate employment without Cause or for Good Reason within the two years following any Change in Control, (2) each such employee’s job level and base salary, (3) the number of equity awards held by each such employee on their respective severance date, the portion of those awards that are not otherwise vested on that date, and the applicable exercise price of any option awards, (4) the market price of the Company’s common stock at the time such awards are ultimately exercised or paid, and (5) the length and level of reimbursement for health care benefits and outplacement services utilized by each such employee.
My Answer: Oh C'mon. Icahn doesn't know squat about anything. He's never run a real company in his lifetime. If he or Microsoft end up taking over Yahoo!, they'll have a lot bigger problems than worry about a lousy 500 million or so in severance payments. What happens when good severance packages are offered and new management takes over is that the good talented employees take up the offer, and the scum at the bottom of the barrel, like you, are left behind. Which means that Yahoo!, an internet company whose sole assets are the brand name and its human resources, will be left without any capable employees to stem the rot which is already destroying the brand. In other words, if either Microsoft or Icahn kick us out, we're taking all of you down with us.
Subscribe to Posts [Atom]
