8-KMaterial AgreementsOther EventsExhibits & Filings

GARMIN LTD 8-K Report, Material Agreement (Jun 7, 2005)

Filed June 7, 2005For Securities:GRMN

Summary

Garmin Ltd. (GRMN) filed an 8-K on June 7, 2005, to report the approval of its 2005 Equity Incentive Plan by its shareholders on June 3, 2005. This new plan is designed to incentivize and retain key employees by offering a variety of equity-based awards, including non-qualified and incentive stock options, restricted shares, bonus shares, deferred shares, stock appreciation rights, performance units, and performance shares. The plan authorizes up to 5,000,000 common shares for awards, representing approximately 4.6% of the shares outstanding as of April 1, 2005. The plan includes provisions for administration by the Board of Directors or its Compensation Committee, individual award limits (not to exceed 1,000,000 shares in a five-year period per employee), and specific terms for award exercise, vesting, and transferability. Importantly, the plan also outlines change of control provisions that can accelerate vesting and settlement of awards.

Key Highlights

  • 1Garmin shareholders approved the 2005 Equity Incentive Plan on June 3, 2005.
  • 2The plan provides for grants of various equity awards including stock options, restricted shares, and performance-based awards.
  • 3Up to 5,000,000 common shares are reserved for awards under the plan.
  • 4This reserved share pool represents approximately 4.6% of Garmin's common shares outstanding as of April 1, 2005.
  • 5The plan aims to strengthen employee commitment, stimulate performance, and aid in attracting and retaining talent.
  • 6Individual award limits are set at a maximum of 1,000,000 shares per employee over a five-year period.
  • 7The plan includes provisions for accelerated vesting of awards upon a change of control event under specific termination conditions.

Frequently Asked Questions

The primary purpose of the 2005 Equity Incentive Plan is to align the interests of key employees with those of the Company's shareholders, thereby strengthening employee commitment, stimulating their efforts on behalf of Garmin, and assisting in the attraction and retention of talented individuals.

The 2005 Equity Incentive Plan authorizes up to 5,000,000 common shares for awards. This represents approximately 4.6% of the company's common shares outstanding as of April 1, 2005.

The plan allows for grants of non-qualified stock options, incentive stock options, restricted shares, bonus shares, deferred shares, stock appreciation rights, performance units, and performance shares.

In the event of a change of control, the plan provides for accelerated vesting and immediate exercisability of stock options and SARs. Restrictions on restricted stock and deferred shares will lapse, and performance awards will be vested and paid out on a prorated basis under certain employee separation conditions within one year following the change of control.