Summary
Cadence Design Systems, Inc. (CDNS) filed an 8-K on March 21, 2018, detailing amendments to the employment agreement of its Chief Executive Officer, Lip-Bu Tan. The key change involves an increase in Mr. Tan's base salary to $725,000 annually, along with eligibility for a target incentive bonus of 125% of his base salary under the Senior Executive Bonus Plan. This compensation adjustment signals continued confidence in executive leadership and alignment with performance incentives. Furthermore, the severance package for Mr. Tan has been enhanced. In the event of termination without 'Cause' or a 'Constructive Termination' (as defined in the agreement), he will receive a lump-sum payment equivalent to 125% of his annual base salary. This amount increases to 187.5% of his annual base salary if such termination occurs in connection with a 'Change in Control.' These updated provisions provide greater financial security to the CEO under specific separation scenarios, particularly those related to corporate control transitions.
Key Highlights
- 1Lip-Bu Tan, CEO of Cadence Design Systems, Inc., received an amendment to his employment agreement.
- 2Mr. Tan's annualized base salary has been increased to $725,000.
- 3He is eligible to earn an incentive bonus targeted at 125% of his base salary.
- 4Severance payment for termination without 'Cause' or 'Constructive Termination' (not related to a Change in Control) increased to 125% of annual base salary.
- 5Severance payment for termination without 'Cause' or 'Constructive Termination' (related to a Change in Control) increased to 187.5% of annual base salary.
- 6The amendments were approved by the Compensation Committee of the Board of Directors on March 15, 2018.