Markets

Genentech's Levinson May Have No Change-of-Control Agreement in Roche Deal

By Jim Edwards

Updated on: March 12, 2009 / 11:19 AM EDT / MoneyWatch

Genentech CEO Arthur Levinson gets no special benefits for agreeing to sell his company to Roche for $95 a share, according to the company's most recently filed proxy statement.

That's a stark contrast to Schering-Plough CEO Fred Hassan, who had specific cash bonuses written into his compensation in the event that he sold the company, netting him a $59 million package, according to the company. (Hassan recently sold Schering to Merck.)

Levinson gets a premium on his shares, of course, which were trading at $70-ish before Roche came looking to take over the company completely. And that will help his options, of which he owns many. Usually, in the event of a takeover, all stock vests immediately. All of Levinson's option grants are in the money at the deal price, $95.

But here's what Genentech's SEC filing says about executive pay in the event of a takeover (it's on page 32):

We do not currently provide change of control or employment agreements for our [named executive officers].

Levinson's 2007 agreement (the most recent on file) is relatively modest compared to those of Hassan or Merck's Richard Clark. He doesn't get to ride around on a private jet, like Clark and his wife, for instance.

The total value of Levinson's compensation in 2007 was $18 million, up from $17 million the year before. But almost all of that was in stock and options. Stock and options are subject to vesting schedules and the future value of the stock. In terms of cash, Levinson was paid a basic salary of $995,000 and cash bonuses of $3.1 million.