8-KMaterial AgreementsExhibits & Filings

TERADYNE, INC 8-K Report, Material Agreement (Jan 28, 2005)

Filed January 28, 2005For Securities:TER

Summary

Teradyne, Inc. (TER) filed an 8-K on January 28, 2005, disclosing material changes related to executive compensation and director pay. The Board of Directors approved amendments to the 1996 Non-Employee Director Stock Option Plan to significantly increase the annual stock option grant and cash retainer for the non-employee Chairman of the Board, recognizing the expanded responsibilities of the role. Furthermore, the Company adopted a Variable Compensation Plan (VC Plan) for 2005, designed to provide performance-based variable compensation to executive officers and key senior employees. Payouts under the VC Plan are contingent upon overall corporate and individual business group performance, with the Compensation Committee evaluating factors such as profitability, return on net assets, market share, and strategic positioning. This plan aims to incentivize performance tied to strategic and financial objectives.

Key Highlights

  • 1Teradyne increased the annual cash retainer for its non-employee Chairman of the Board from $45,000 to $90,000.
  • 2The annual stock option grant for the non-employee Chairman was doubled from 15,000 to 30,000 shares.
  • 3The Board adopted a Variable Compensation Plan (VC Plan) for 2005 for executive officers and eligible senior employees.
  • 4VC Plan payouts are based on a percentage of base salary, determined by overall corporate and individual business group performance.
  • 5Performance metrics for the VC Plan include profitability, return on net assets, market share, and strategic business group results.
  • 6The Compensation Committee has the discretion to adjust, modify, or terminate the VC Plan.
  • 7The filing includes the Variable Compensation Plan for 2005 as Exhibit 99.1.

Frequently Asked Questions

Teradyne doubled the annual cash retainer for its non-employee Chairman from $45,000 to $90,000 and doubled the annual stock option grant from 15,000 to 30,000 shares. These increases were made in recognition of the substantial time, effort, and responsibilities associated with the Chairman position.

The VC Plan is designed to provide variable compensation to executive officers and certain eligible senior employees based on their performance and the Company's overall performance. The goal is to incentivize key personnel by tying a portion of their compensation to corporate and business unit achievements.

Payouts under the VC Plan are calculated as a percentage of a participant's base annual salary, known as the 'VC Factor.' This factor is determined by the Compensation Committee based on the prior year's overall corporate and individual business group performance, considering factors like profitability, market share, and strategic positioning.

Yes, the Company's Board of Directors and/or Compensation Committee reserve the right to adjust, modify, or terminate the VC Plan, in full or in part, at any time in their sole discretion. This provides flexibility to adapt the plan as needed.