Symantec 2016 Annual Report Download - page 61

Restricted Stock Units (RSUs): RSUs represent the right to receive one share of Symantec common stock
for each RSU vested upon the settlement date, which is the date on which certain conditions, such as continued
employment with us for a pre-determined length of time, are satisfied. The Compensation Committee believes
that RSUs align the interests of the named executive officers with the interests of our stockholders because the
value of these awards appreciates if the trading price of our common stock appreciates, and these awards also
have retention value even during periods in which our trading price does not appreciate, which supports con-
tinuity in the senior management team.
Shares of our stock are issued to RSU holders as the awards vest. The vesting schedule for RSUs granted to
our named executive officers in fiscal 2016 as part of the annual review process provide that each award vests in
three installments: 30% in June 2016, 30% in June 2017 and 40% in June 2018. (Details of RSUs granted to our
named executive officers in fiscal 2016 are disclosed in the Grants of Plan-Based Awards table on page 62 and
summarized in the last table within the next subsection below.)
Performance-based Restricted Stock Units (PRUs): The Compensation Committee grants PRUs in further-
ance of our pay for performance philosophy. Our Compensation Committee established this program to enhance
our pay for performance culture with a component directly linked to our total stockholder return over two- and
three-year periods. Unlike our RSU awards, the shares underlying the PRUs awarded for fiscal 2016 are eligible
to be earned only if we achieve a threshold of non-GAAP EPS. For the reasons discussed in the summary section
of this CD&A, due to the Veritas Sale, the fiscal 2016 payout level was based on the combined Symantec/Veritas
non-GAAP EPS achievement for the first three quarters of fiscal 2016. Depending on our achievement of this
metric, 0% to 133% of the target shares will be eligible to be earned at the end of fiscal 2017 and fiscal 2018,
based on, and subject to further adjustment as a result of, the achievement of the TSR ranking for our company as
compared to the S&P 500. If any target shares become eligible (the “eligible shares”) to be earned in fiscal 2017
and fiscal 2018 as a result of achievement of the non-GAAP EPS metric for fiscal 2016, then 50% to 150% of
one-half of the eligible shares may be earned based on the achievement of the TSR goal for the two years ended
March 31, 2017 and 50% to 150% of one-half of the eligible shares (plus any eligible shares not earned on
March 31, 2017 if less than 100% of the TSR goal is achieved for the two-year period then ended) may be earned
based on the achievement of the TSR goal for the three years ended March 30, 2018. Subject to certain
exceptions (including acceleration of vesting upon a change in control of our company under the terms of the
Symantec Executive Retention Plan, as amended), the award shall vest, if at all, only at the end of the third year
of the performance period (i.e., fiscal 2018), and the named executive officer must be employed by us at the end
of such period in order to vest in the award. The following table summarizes the foregoing discussion of thresh-
old, target and maximum performance levels and payouts at each level:
EPS Performance as
a Percentage of
Target (%)
EPS Payout as
a Percentage
of Target (%)
TSR Percentile
Rank against
S&P500
TSR Payout as a
Percentage of Target
(%)
Threshold Level Payout % .......... 70% 50% 35th 50%
Target Level Payout % ............. 100% 100% 50th 100%
Maximum Payout % .............. 120% 133% 75th 150%
For the first three fiscal quarters of fiscal 2016, our non-GAAP EPS target under the PRUs was $1.46 per
share. The Compensation Committee determined that we achieved 88.7% of this metric, resulting in 81.2% of the
target shares becoming eligible to be earned based on achievement of the multi-year relative TSR performance
goals under the PRUs. Pursuant to the terms of these awards, each named executive officer will be eligible to
receive at least half of the eligible shares if he remains employed by Symantec through the last day of fiscal 2018
even if we fail to achieve those TSR performance goals (median of S&P 500), and could receive up to 150% of
such shares, depending upon the degree to which we achieve of those goals and the same employment condition
is met.
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