Logitech 2015 Annual Report Download - page 88

Compensation Report for Fiscal Year 2015
– Proxy Statement | 78
2015 Annual General Meeting Invitation, Proxy Statement
Employment Arrangements
We have extended written employment agreements or
offer letters or both to each of our executive officers,
including our CEO and our other executive officers. Each
of these arrangements was approved on our behalf by
our Board of Directors or the Compensation Committee,
as applicable. We believe that these arrangements were
appropriate to induce these individuals to forego other
employment opportunities or leave their current employer
for the uncertainty of a demanding position in a new and
unfamiliar organization.
In filling these executive positions, our Board of Directors
or the Compensation Committee, as applicable, was
aware that it would be necessary to recruit candidates
with the requisite experience and skills to manage a
growing business in a dynamic environment. Accordingly,
it recognized that it would need to develop competitive
compensation packages to attract qualified candidates
in a highly-competitive labor market. At the same time,
our Board of Directors or the Compensation Committee,
as applicable, was sensitive to the need to integrate
new executive officers into the executive compensation
structure that it was seeking to develop, balancing both
competitive and internal equity considerations.
Each of these employment arrangements provides for “at
will” employment and sets forth the initial compensation
arrangements for the Named Executive Officer, including
an initial base salary, a target annual cash bonus
opportunity, and, in some instances, a recommendation
for an equity award.
For a summary of the material terms and conditions of
the employment arrangements with each of our executive
officers, see “Employment Arrangements” below.
Post-Employment Compensation
All named executive officers are eligible to receive
benefits under certain conditions in accordance with
Logitech’s Change of Control Severance Agreement
(“Change of Control Agreement”), as described in
the section “Potential Payments Upon Termination or
Change in Control” below. These Agreements are being
reviewed by the Compensation Committee with respect
to compliance with the Minder Ordinance by the end of
calendar year 2015.
The purpose of the Change of Control Agreements is to
support retention in the event of a prospective change of
control. Should a change of control occur, benefits will be
paid after a “double trigger” event – meaning that there
has been both a change of control, and the executive
is terminated without cause or resigns for good reason
within 12 months thereafter – as described in “Potential
Payments Upon Termination or Change in Control” below.
The RSU and PSU award agreements for executive
officers generally provide for the acceleration of vesting
of the RSUs and PSUs subject to the award agreements
under the same circumstances and conditions as under
the Change of Control Agreements; namely, if the named
executive officer is subject to an involuntary termination
within 12 months after a change of control because his
or her employment is terminated without cause or the
executive resigns for good reason (a “double trigger”).
In the event of an involuntary termination within 12 months
after a change of control with respect to awards granted
before fiscal year 2015:
• All unvested shares subject to the RSUs will vest in
full. 100% of the shares subject to the PSUs will vest
if the change of control occurred within 1 year after the
grant date of the PSUs. If the change of control occurs
more than 1 year after the grant date of the PSUs, the
number of shares subject to the PSU that will vest will be
determined by applying the performance criteria under
the PSUs as if the performance period had ended on
the date of the change of control.