Yahoo GC Michael Callahan has sold $2 million of stock over the past two years, according to research published by activist investor Ironfire Capital.
He’s not the only one, and we go into more detail on that after the jump. But based on current stock price ($15.59 close on 9/11/09), the 785,422 shares he still holds are worth $12.24 million, so it’s not like he’s been dumping stock left and right. He has sold 241,070 shares, so just about a quarter of his total holdings. It’s also not like the prices have been running up during his sales, he has sold as high as $28.38 and as low as $13.03.
After the jump, we’ve put together a bio of Callahan, including his comp for the past few years (better than the PPP from his old firm), and dug up an old quote that strikes us as disingenuous.
According to Yahoo’s most-recent proxy, Callahan’s base salary since March 3, 2008 is $420,000. Despite the company’s missing all of its quantitative targets for the year, Callahan, like the other Named Executives, got a bonus equal to 50% of target. In his case, that worked out to $157,500. His total comp for 2008 was $4,570,758. In 2007 his base was $351,250 and his bonus was $225,000. All in, he got $4,577,567 for 2007. In 2006, his base was $325,000 and his bonus was $200,000. His total comp was $3,087,143.
Skadden’s PPP was $2.06 million in 2008.
We’re not saying that money wasn’t earned, of course. The company has had a rough go of it the past year and a half, as it muddled through a number of takeover offers and alliance deals before finally handing search over to Microsoft and seeing founder Jerry Yang kicked out. SuperLawyers profiled him earlier this year and he got some nice quotes from the likes of Kent Walker (Google’s general counsel), Jon Woodruff (co-head of Goldman Sachs’ global tech banking division) and Ron Olson of Munger, Tolles & Olson.
Callahan (Georgetown BS, UConn JD ‘95) has actually sold more than any of his continuing-executive peers at Yahoo (although there has been a ton of turnover at the top, so he’s also among the longest-tenured now). Callahan joined Yahoo in 1999 from Electronics for Imaging, where he worked “in a business development capacity and as corporate counsel.” Prior to that, he spent four years as an associate at Skadden doing M&A (so the stint at Electronics for Imaging, whatever that is/was was really short). His first three years were in Boston, then he lateralled to the San Francisco office for about a year before going inhouse. So he went from fifth-year associate to GC in about four years. Not bad!
Interestingly, when he was promoted to GC in 2003 (at the tender age of 35, by the way), he reported to Sue Decker, who was CFO at the time. Decker, you’ll recall, was the incumbent President of Yahoo who lobbied hard for the CEO job when Yang was ousted, but lost to Carol Bartz, who was brought in from AutoDesk, leading to Decker’s resignation. Callahan now reports directly to CEO Bartz.
Of the other continuing executives,
- Bartz has sold $1,982,018, and still holds 987,142 shares;
- EVP of Yahoo North America Hilary Schneider has sold $1,102,413, and still holds 321,560 shares;
- EVP of Products and CTO Ari Balogh has sold $39,640, and still holds 112,493; and
- EVP and CFO Tim Morse has sold nothing but holds 150,000 shares (he joined effective July 1, so he might not be fully vested yet).
We also came across this old article from The Recorder, hosted by our friends at Adam Smith, Esq. The piece talks about tech companies’ growing up and shifting work from local startup counsel like Wilson Sonsini and Venture Law Group (which had already become part of Heller Ehrman (RIP) at the time) to New York firms. Yahoo’s use of Skadden in its acquisition of Kelkoo (who?) is given as Exhibit A, because VLG had taken the company public.
Yahoo’s migration to Big Apple counsel may be the most high profile in the region. The company’s relationship with Skadden began in 2000 with small transactional business, according to Callahan. The first “really significant piece of business” with Skadden was the acquisition of HotJobs.com in 2001.
“I knew the local team … and its strength in corporate transactions and complicated M&A work. I wanted
that experience close to home,” Callahan said.“The benefit of the national resources is important because you have access to the specialty groups,” he said. “You have in-house antitrust expertise, employee benefits expertise.”
So they even interviewed Callahan, but don’t make any mention of the fact that he was just using his old firm. That’s almost certainly a more-dispositive reason for switching firms than the nonsense he spewed about access to specialty groups. Is it really a coincidence that he went back to his pals within a year of joining the company? We call BS.
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