As expected, SAP AG shareholders today approved a stock option plan designed to help the company retain executives and top performers.
Subsidiary SAP America Inc. has suffered from a stream of executive departures during the past year, the most recent of which was the resignation last week of Chief Financial Officer John Milana. [See, "UPDATE: CFO Leaves SAP America," Jan. 14.]The plan approved today, the SAP AG 2000 Long Term Incentive Plan (LTI Plan), expands the current SAP stock-based incentive plan, according to an SAP press release. The LTI plan comprises stock options and convertible bonds. The stock options have value only when the SAP preference share price exceeds the performance of a reference index for a defined period, SAP said. The stock options and bonds are issued over a four-year vesting period.
Over the past year and a half, SAP America has lost a stream of top executives, many of whom ended up at Siebel Systems Inc. SAP is suing Siebel, accusing Siebel of purposely targeting SAP to damage the company's business.
SAP Chief Executive Officer Kevin McKay said in a telephone interview last week that he expected the new stock option plan that was approved today to help the company retain top performers in the competitive high-technology environment.
SAP America Inc., a subsidiary of SAP AG of Germany, is located in Newtown Square, Pennsylvania, and can be reached at +1-610-661-1000, or at http://www.sap.com.