RealTime IT News

Ouster of CEO Will Cost Priceline.com

Priceline.com's decision to oust its former CEO, Daniel Schulman, will result in a charge of approximately $5.8 million in the second quarter of 2001, the name-your-price e-commerce company said in a filing with the Securities and Exchange Commission.

Priceline named its chairman, Richard S. Braddock, to replace Schulman on May 8.

The company said in a quarterly filing with the SEC that the charge is primarily "the result of the acceleration of the forgiveness of loans to ... Schulman and the acceleration of the vesting of restricted stock, each of which were required by the terms of (his) employment agreement."

Severance, benefits and legal fees are also included in the figure. Despite the charge, at the time Schulman was axed, the company reiterated that it expects to reach pro forma operating profitability in the second quarter.

Schulman came to Priceline in June 1999 from AT&T, where he had been president of the consumer-markets division.

Priceline has been executing a turn-around plan after its share price plunged to as little as $1.06 when it ran into problems last fall. At one time it had traded at more than $100 a share. The stock was at $4.84 in mid-morning trading, up 44 cents.

Meanwhile, the company's founder, Jay Walker, who resigned from Priceline's board of directors last year, filed with the SEC to sell 1.875 million shares of the company's common stock valued, at $9.9 million, according to Dow Jones reports. Walker still beneficially owns upwards of 40 million shares, however.