Electronic Arts 2012 Annual Report Download - page 56

Performance-Based RSU Program
In June of 2011 the Committee granted each of our NEOs (excluding Mr. Barker and Mr. Taneja) a target mix of
50% time-based RSUs and 50% performance-based RSUs.
The actual number of performance-based RSUs earned will be determined by the Committee and range from zero
to 200% of the target award based on the Company’s TSR relative to the performance of each of the companies
in the NASDAQ-100 over one-year (fiscal 2012), two-year (fiscal 2012 through 2013), and three-year (fiscal
2012 through 2014) measurement periods. TSR is determined based on a 90-day trailing average of the closing
stock prices of the NASDAQ-100 at the end of each measurement period as compared to the 90-day trailing
average of the closing stock prices of the NASDAQ-100 at the beginning of the measurement period. For each
measurement period, the Company’s TSR must be at the 60th percentile of the TSR of companies in the
NASDAQ-100 in order for 100% of the target award to vest. This requires the Company to outperform the
majority of companies in the NASDAQ-100 for the targeted number of shares to vest. If our TSR is above or
below the 60th percentile, the number of shares that vest will increase by 3% for each percentile above the 60th,
or decrease by 2% for each percentile below the 60th.
For fiscal 2013, the Company will continue to target the composition of our annual equity awards as 50%
performance-based RSUs and 50% time-based RSUs to each of our NEOs (excluding Mr. Barker). The fiscal
2013 performance-based RSUs will also vest between zero to 200% based upon the relative TSR performance of
the Company over one, two, and three-year measurement periods. The design reflects the Committee’s belief that
a mix of both performance- based and time-based equity awards balances our desire to drive long-term stock
price growth and promote long-term retention.
Prior Performance-Based RSU Program
We have previously utilized performance-based equity to motivate management and reward increased
profitability. Each of our NEOs (except Mr. Taneja) has an outstanding performance-based RSU award that was
granted in fiscal 2009. These performance-based RSUs may be earned based upon the Company’s achievement
of one of three progressively higher adjusted non-GAAP net income targets (as measured on a trailing-four-
quarter basis). These targets range from approximately two to three times the Company’s non-GAAP net income
for fiscal 2008 and can be earned through the performance period ending on June 30, 2013. To the extent that the
Company does not achieve one or more of the non-GAAP net income targets, the portion of the award that would
have been earned upon the achievement of the applicable target will be cancelled. At the time these performance-
based RSUs were granted to our NEOs, we believed that achievement of the first adjusted non-GAAP net income
target was probable. As of March 31, 2012, no shares of the fiscal 2009 performance-based RSUs had been
earned and during fiscal 2012, we determined that the performance criteria for these awards were improbable of
achievement.
Benefits and Retirement Plans
We provide a comprehensive benefits package to all of our regular, full-time employees, including our NEOs,
which includes medical, dental, prescription drug, vision care, disability insurance, life insurance, accidental
death and dismemberment (“AD&D”) insurance, a flexible spending plan, business travel accident insurance, a
tax-qualified Section 401(k) savings plan, an educational reimbursement program, an adoption assistance
program, an employee assistance program, an employee stock purchase plan, certain paid holidays and personal
time-off. These benefits, and the levels provided, are consistent with those offered by similar-sized companies.
We also maintain a nonqualified deferred compensation plan in which certain employees, including our NEOs
and our Directors are eligible to participate. None of our NEOs participated in the deferred compensation plan
during fiscal 2012.
Perquisites and Other Personal Benefits
We have consistently taken a conservative approach with respect to providing perquisites and other personal
benefits to our NEOs. While our NEOs generally receive the same benefits that are available to our other regular,
full-time employees, they also receive certain additional benefits, including access to a Company-paid physical
examination program, and greater maximum benefit levels with respect to life insurance, AD&D, and long-term
disability coverage. We consider these benefits to be standard components of a competitive executive
compensation package. Company-reimbursed air and ground transportation is restricted to business travel.
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