madharry, while I do not like such arrangements, I think it is just one element in the investment picture, and I believe your apparently blind sale of SEMI on the basis of one is questionable.
In the first place, from the Def 14A you appear to have significantly overstated SEMI's deal, as the percentage seems to be 8%, and limited to 2 times base salary:
"Under the Goldberg Agreements, Paul Goldberg and Bruce M. Goldberg are entitled to receive, in the case of Paul Goldberg, an annual cash bonus equal to 3% and, in the case of Bruce M. Goldberg, an annual cash bonus in 1999 equal to
4% and in 2000 and thereafter 5% of the Company's pre-tax income, before nonrecurring and extraordinary charges, in excess of $1,000,000 in any calendar year. Such annual bonus compensation for each of Paul Goldberg
and Bruce M. Goldberg is limited in any year to an amount no greater than two times his respective base salary for the applicable year."
Second, you have to look at the big picture. Is mgmt on the same side of the table with you or not. SEMI's mgmt owns more than 10% of the stock plus a bunch of options, and benefits far more from 10 points on the stock than from any other compensation.
Third has the company delivered. SEMI probably had top 10% earnings and stock price performance in 2000, which is pretty good for a tech related business. If I had had all my money in SEMI on 1/1/00 I would have a hell of a lot more money than I do today. |
