Summary
Synopsys, Inc. (SNPS) filed an 8-K on June 3, 2008, to report amendments to the employment agreements of its CEO, Dr. Aart de Geus, and COO, Dr. Chi-Foon Chan. These amendments were approved by the Compensation Committee on May 28, 2008, and are primarily intended to ensure compliance with Section 409(A) of the Internal Revenue Code by the December 31, 2008 deadline. The changes also align the treatment of unvested equity awards for these top executives with those of other executives. Specifically, in the event of a qualifying termination following a change in control, all unvested equity awards held by Dr. de Geus and Dr. Chan will now accelerate and vest in full, mirroring the existing provision for their stock options. To receive these benefits, both executives will be required to execute releases in favor of Synopsys. The full details of these amended agreements are provided as exhibits to this filing.
Key Highlights
- 1Amendments to employment agreements for CEO Dr. Aart de Geus and COO Dr. Chi-Foon Chan approved on May 28, 2008.
- 2Primary purpose of amendments is to ensure compliance with Section 409(A) of the Internal Revenue Code by the end of 2008.
- 3Equity award treatment harmonized: in case of a qualifying termination after a change in control, all unvested equity awards for both executives will now fully vest.
- 4This accelerated vesting for equity awards now aligns with the treatment of their stock options.
- 5Executives must sign releases in favor of Synopsys to be eligible for benefits under the amended agreements.
- 6Amended and Restated Employment Agreements are filed as exhibits to the 8-K report.