Summary
Synopsys, Inc. (SNPS) filed an 8-K report on January 28, 2010, detailing key changes in its executive compensation and employee stock plans. The Compensation Committee of the Board of Directors approved the Executive Incentive Plan (EIP) for fiscal year 2010, which outlines performance-based bonuses for officers tied to revenue targets, operating margins, and revenue backlog. The plan includes specific thresholds for bonus eligibility and payout limits, with a minimum performance requirement of 90% of corporate financial goals for any bonus to be earned. Additionally, the Board approved amendments to the Employee Stock Purchase Plan (ESPP). These amendments are designed to increase the number of authorized shares, align the plan with final IRS regulations under Section 423, and provide greater flexibility in structuring offerings, including separate US and international plans. The ESPP amendments will be presented to stockholders for approval at the 2010 Annual Meeting, with certain conforming changes effective March 1, 2010.
Key Highlights
- 1Synopsys approved its Executive Incentive Plan (EIP) for fiscal 2010, tying officer bonuses to company performance.
- 2Key performance metrics for the EIP include current fiscal year revenue, non-GAAP operating margin, and future revenue backlog targets.
- 3The EIP requires a minimum of 90% achievement of Corporate Financial Performance Goals for any bonus payout.
- 4Maximum bonus payouts under the EIP are capped at $2,000,000 or 200% of the target bonus, whichever is less.
- 5The Board approved an amended and restated Employee Stock Purchase Plan (ESPP).
- 6The ESPP amendments will increase the number of shares available for issuance by 5,000,000.
- 7The ESPP is being updated to comply with final regulations under Section 423 of the Internal Revenue Code and to allow for more flexible offering structures.