Summary
Cadence Design Systems, Inc. (CDNS) filed an 8-K on February 11, 2005, reporting a new material definitive agreement. Specifically, the company's Board of Directors adopted a new plan to provide health care and prescription drug insurance coverage for active non-employee directors and eligible retired directors and their dependents. This plan, effective February 8, 2005, offers a significant benefit by covering 100% of participant premiums up to an annual maximum of $15,000, subject to adjustments for future healthcare cost changes. The new plan replaces a previous director healthcare plan adopted in October 2002. It's important for investors to note that while Cadence will cover the premiums, the benefits received by the participants will be fully taxable to them, and the company will not cover these taxes. This initiative reflects Cadence's commitment to compensating its non-employee directors, which could be a factor in director retention and board effectiveness.
Key Highlights
- 1Cadence Design Systems adopted a new health care and prescription drug insurance plan for its non-employee directors and eligible retired directors.
- 2The plan became effective on February 8, 2005, and was adopted by the Board of Directors.
- 3Cadence will reimburse 100% of health insurance premiums for eligible participants and their dependents.
- 4There is an annual maximum reimbursement limit of $15,000 per participant, which is subject to future adjustments for inflation.
- 5The benefits provided under this plan are fully taxable to the recipients.
- 6This new plan supersedes a director healthcare plan that was previously adopted in October 2002.
- 7William Porter, Senior Vice President and Chief Financial Officer, signed the report.