Novell: Will Some Executives Exit March 9?
Let’s assume Attachmate finalizes the Novell acquisition on March 9, 2011. According to an SEC filing, Certain Novell executives could earn $1.38 million to $6.85 million in lump sum cash payments if their positions are terminated on that date. So which Novell executives are staying and which ones may leave with a hefty bounty? The VAR Guy doesn’t know for sure. But here’s a look at potential severance packages, including potential cash payouts for Novell’s CEO and Novell’s channel chief.
A December 2010 SEC filing from Novell states:
Each of our executive officers (consisting of Ronald W. Hovsepian, our President and Chief Executive Officer, Dana C. Russell, our Senior Vice President and Chief Financial Officer, John K. Dragoon, our Senior Vice President and Chief Marketing Officer, Joseph H. Wagner, our Senior Vice President and General Manager, Global Alliances, Russell C. Poole, our Senior Vice President, Human Resources, Scott N. Semel, our Senior Vice President, General Counsel and Secretary, James P. Ebzery, our Senior Vice President and General Manager, Security, Management and Operating Platforms, Colleen A. O’Keefe, our Senior Vice President and General Manager, Collaboration Solutions and Global Services and Javier F. Colado, our Senior Vice President, Worldwide Sales), is eligible for severance benefits under severance agreements with us.
The list above includes executives with extensive channel experience — such as Senior VP and Chief Marketing Officer John Dragoon, who serves as the company’s current channel chief; and Senior VP of Worldwide Sales Javier Colado, who previously served as channel chief.
According to a table in the SEC filing, certain executives could receive cash payments if the merger closes on March 9, 2011 and their positions are terminated on such date. In that scenario, CEO Ronald Hovsepian would receive a $6.85 million lump some cash payment plus certain health and dental coverage and 401K matching contributions. Also, Channel Chief John Dragoon would receive a $1.95 million lump sum if his position is terminated March 9; and former Channel Chief Javier Colado would receive a $2.39 million million lump sum cash payment if his position is terminated March 9.
During a late November 2010 interview with The VAR Guy, Dragoon declined to speculate whether he would remain with Novell or depart post-merger.
No Cause for Panic
Of course, it’s important for The VAR Guy to keep the information in perspective. Attachmate has publicly stated that the company remains committed to Novell’s PartnerNet channel partner program. Also, Attachmate has committed to shipping all Novell products that are scheduled for delivery in the current quarter — though there are signs that Attachmate may consider evolving some of Novell’s brand names while taking a close look at some products that are in beta.
Plus, Novell and Attachmate are trying to decide when and where to hold BrainShare conferences in 2011.
Bottom line: The VAR Guy believes Attachmate and Novell are still negotiating which executives will stay and which ones will exit once the merger closes. Some answers may leak out soon. But it sounds like most answers should emerge by March 9, 2011.
Also, the severance packages seem relatively conservative compared to the original severance agreement Mark Hurd received upon exiting Hewlett-Packard.