8-KLeadership Changes

ANALOG DEVICES INC 8-K Report, Executive Changes (Jan 23, 2008)

Filed January 23, 2008For Securities:ADI

Summary

Analog Devices, Inc. (ADI) has filed an 8-K report detailing the approval of its 2008 Executive Bonus Plan by the Compensation Committee. This plan outlines the framework for bonus payments to executive officers and senior management for fiscal year 2008. The plan links bonus payouts directly to the company's financial performance, specifically operating profit before tax (OPBT) as a percentage of revenue, and individual performance metrics. Investors should note that the bonus structure is designed with significant upside potential, with a Bonus Payout Factor that can range from 0% to 300% of an individual's target bonus, which is itself determined by base salary and an individual target bonus percentage (50%-160%). Furthermore, certain participants have the potential for an additional bonus increase of up to 30% based on superior individual business performance, as assessed by the CEO and approved by the Compensation Committee. Bonus distributions will occur semi-annually, with the final payout including any adjustments for individual performance.

Key Highlights

  • 1ADI's Compensation Committee approved the 2008 Executive Bonus Plan on January 22, 2008.
  • 2The plan applies to executive officers and other senior management selected by the CEO.
  • 3Bonuses are based on a "Fiscal 2008 Bonus Target" (Base Salary x Individual Target Bonus Percentage) and a "Bonus Payout Factor."
  • 4The Bonus Payout Factor is directly tied to the Company's operating profit before tax (OPBT) as a percentage of revenue.
  • 5The Bonus Payout Factor can range from 0% to 300% of the Fiscal 2008 Bonus Target.
  • 6Participants (excluding Ray Stata and Jerald Fishman) are eligible for an additional bonus of up to 30% based on superior individual business performance.
  • 7Bonus payments are calculated quarterly and distributed semi-annually, with the final payout adjusted for individual performance.

Frequently Asked Questions

Each participant's Fiscal 2008 Bonus Target is calculated by multiplying their Base Salary for the bonus period by their Individual Target Bonus Percentage. This Individual Target Bonus Percentage is determined individually by the Compensation Committee and can range from 50% to 160% of the base salary.

The actual bonus payout is determined by multiplying the Fiscal 2008 Bonus Target by a Bonus Payout Factor. This factor is based on the company's operating profit before tax (OPBT) as a percentage of revenue and can range from 0% to 300%. The Compensation Committee can adjust this factor to exclude special or non-recurring items.

Yes, participants (excluding Ray Stata and Jerald Fishman) are eligible for an additional Individual Payout Factor that can increase their bonus payment by up to 30%. This is based on evidence of superior business performance, such as overachieving revenue and profitability goals, or achieving positive non-financial results, as assessed by the CEO and approved by the Compensation Committee.

Bonus payments are calculated quarterly. Distributions are made after the first half and second half of fiscal year 2008. Any bonus amounts related to the Individual Payout Factor for superior performance are distributed after the end of the fiscal year.