8-K/AOther EventsExhibits & Filings

ADVANCED MICRO DEVICES INC 8-K/A Report, Corporate Update (Mar 13, 2017)

Filed March 13, 2017For Securities:AMD

Summary

This 8-K amendment from Advanced Micro Devices, Inc. (AMD) addresses the final resolution of a stockholder derivative lawsuit concerning equity awards granted to CEO Dr. Lisa Su in 2014. Initially, certain awards were rescinded due to a technical violation of the 2004 Equity Incentive Plan's share limit. AMD subsequently replaced these awards in multiple tranches, seeking to restore Dr. Su's compensation. The lawsuit alleged that these replacements constituted an amendment to the plan requiring shareholder approval. The Delaware Court of Chancery ruled in favor of AMD, stating the rescission and replacement did not constitute a plan amendment and did not require a shareholder vote. The company has now agreed to pay $55,000 in legal fees to the stockholder's counsel to settle the matter, despite believing no benefit was conferred. This filing serves as notification of the court's dismissal of the complaint with prejudice and the agreed-upon settlement, effectively concluding this long-standing legal issue for AMD.

Key Highlights

  • 1Final resolution of a stockholder derivative lawsuit concerning CEO Lisa Su's equity awards granted in 2014.
  • 2The lawsuit alleged that the replacement of certain rescinded equity awards constituted an amendment to the 2004 Equity Incentive Plan requiring shareholder approval.
  • 3The Delaware Court of Chancery ruled in favor of AMD, dismissing the lawsuit with prejudice.
  • 4The court found that the rescission and subsequent replacement of awards did not constitute a plan amendment and did not require shareholder approval.
  • 5AMD agreed to pay $55,000 in legal fees to the stockholder's counsel to settle the matter, despite believing no benefit was conferred.
  • 6This filing provides notice of the court's dismissal and the settlement, bringing closure to the legal dispute.

Frequently Asked Questions

The lawsuit originated from concerns that equity awards granted to CEO Dr. Lisa Su in 2014 exceeded the per-year share limit under AMD's 2004 Equity Incentive Plan. To address this, AMD rescinded certain awards and later replaced them.

No. The Delaware Court of Chancery ruled that the rescission and subsequent replacement of the equity awards did not constitute an amendment to the 2004 Equity Incentive Plan and therefore did not require a shareholder vote.

AMD has agreed to pay $55,000 in legal fees to the stockholder's counsel to settle the matter. This is a relatively small amount for a publicly traded company and is intended to avoid further litigation costs, even though AMD believes no benefit was conferred by the lawsuit.

The settlement resolves the legal dispute regarding past equity awards. The company had previously taken steps to replace the voided awards to ensure Dr. Su's compensation was restored to its intended level, and this settlement pertains to the legal challenges of those actions, not the compensation itself going forward.