How is the performance measured for the 2015 Performance Share Program?

The performance is measured by Adobe's relative Total Stockholder Return (TSR) compared to the TSR of companies included in the NASDAQ 100 Index over a three-year performance period (fiscal years 2015-2017). Payouts are linked to Adobe's percentile rank within this peer group.

What are the minimum performance requirements for executives to receive bonuses under the 2015 Executive Annual Incentive Plan?

The minimum performance threshold for the 2015 Executive Annual Incentive Plan is the achievement of at least 85% of the GAAP revenue target set forth in the annual operating plan for fiscal year 2015. If this threshold is not met, no incentive bonuses will be paid.

Are there any conditions related to continued employment for these incentive programs?

Yes, for the 2015 Performance Share Program, participants must continue to provide service to Adobe through the later of the certification date (following fiscal year 2017) and January 24, 2018, to earn their performance shares. The Annual Incentive Plan, being a cash bonus for fiscal year 2015, implicitly requires employment during that fiscal year and through the payout, though the filing doesn't explicitly state a post-payout retention requirement for this plan.

ADBE 8-K: Leadership Changes

Q: What is the primary objective of the 2015 Performance Share Program and the 2015 Executive Annual Incentive Plan?

The primary objectives are to align the interests of key employees and executives with those of stockholders by focusing them on building stockholder value, providing significant award potential for outstanding company performance, and enhancing the company's ability to attract and retain highly talented individuals.

Summary

This 8-K filing from Adobe Inc. (ADBE) on January 28, 2015, details the approval of two key executive compensation programs for fiscal year 2015: the 2015 Performance Share Program and the 2015 Executive Annual Incentive Plan. Both programs are designed to align executive interests with stockholder value creation, drive company performance, and enhance talent retention. The Performance Share Program ties awards to relative Total Stockholder Return (TSR) against the NASDAQ 100 over a three-year period (2015-2017), with payouts ranging from 0% to 200% of target awards, contingent on continued employment. The 2015 Executive Annual Incentive Plan is a cash-based bonus program tied to fiscal year 2015 objectives. It requires a minimum of 85% of the GAAP revenue target for any bonuses to be paid. Payouts are determined by a weighted formula that includes corporate results (financial performance and customer advocacy) and individual goals, with a potential payout of up to 200% of the target bonus for each executive, capped at $5 million. Both plans include provisions for recoupment of awards if required by law.

Key Highlights

1Adobe approved the 2015 Performance Share Program, an equity-based incentive tied to relative Total Stockholder Return (TSR) performance over fiscal years 2015-2017.
2The Performance Share Program measures Adobe's TSR against the NASDAQ 100 Index, with payouts ranging from 0% to 200% of target awards based on relative ranking.
3Continued employment through the performance period certification date (and until January 24, 2018) is a condition for earning Performance Shares.
4Adobe also approved the 2015 Executive Annual Incentive Plan, a cash bonus program for fiscal year 2015.
5The Annual Incentive Plan requires achieving at least 85% of the fiscal year 2015 GAAP revenue target to trigger any bonus payments.
6Executive bonuses are determined by a weighted average of Corporate Results (75%) and Individual Goals (25%), with potential payouts up to 200% of target, capped at $5 million.
7Both programs include provisions for recoupment of awards under applicable law and company policy.

ADOBE INC. 8-K Report, Executive Changes (Jan 28, 2015)

Summary

Key Highlights

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