SiliconBeat

ArcSight, the lone Silicon Valley company to hold an initial public offering last year, said that Chairman and former chief executive Robert Shaw resigned Monday due to a “serious health condition” that was not further described.

On Saturday, a day after Shaw’s decision was delivered to the company, the compensation committee to ArcSight’s board of directors “confirmed” that cash bonuses for fiscal 2009 that are to be paid to the company’s executive officers would still be paid to Shaw (pictured), even though he was to have continued to serve as chairman of the board after stepping down as chief executive in September.

The board also recommended that its official size be lowered from nine directors to eight, “while it evaluates ArcSight’s governance structure in light of Mr. Shaw’s departure.”

Among the risk factors enumerated by ArcSight when it registered its intention to hold its IPO in February 2008 was the company’s dependence “on the continued contributions of our senior management and other key personnel, in particular Robert Shaw and (founder) Hugh Njemanze, the loss of whom could harm our business.”

Shaw, 61, served as Chairman and CEO since August 2001. From 1998 until its acquisition in 2001 by Whitman-Hart, Shaw was CEO of USWeb. From 1992 to 1998, he was an executive vice president at Oracle in charge of consulting services and vertical markets.