The former chief executive of a huge dot-flop will receive $375,000 a year for the rest of his life. George Shaheen, 58, former chief of online grocer Webvan, will be paid the money as part of retirement benefits he initiated when he was hired away from Andersen Consulting.
As part of his retirement package, Shaheen will receive 50 per cent of his base salary and target bonus for the rest of his life, according to US reports. The payments will continue to be sent to Shaheen's wife should he die before her.
Shaheen's move from old economy Andersen to new economy Webvan was heralded at the time as 'legitimising' the internet.
The details of the package will be included in a final proxy the company is expected to file with the Securities and Exchange Commission (SEC) by next week. According to SEC documents, Shaheen had been paid an annual salary of $500,000 and a bonus of $250,000.
Shaheen, who resigned on 13 April, could not be reached for comment. Less than one week after his resignation, Webvan was informed that it faced de-listing from the Nasdaq exchange because its stock price no longer met the minimum $1 per share. It closed at 14 cents on Wednesday, down from a 52-week high of $9.37.
Rob Enderle, an analyst at Giga Information Group, said this is not normal at all. Chief executives often get a nice package that includes stock options and equity but not an annuity at this level. "Only politicians get that," he said.
Robert Shaw has replaced Shaheen as chief executive. Last month, Webvan shut down its operations in Sacramento, California and Atlanta, and laid off more than 800 workers.
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