Logitech 2007 Annual Report Download - page 42

During 2007, stock option grants to Executive Officers and other employees were made during regularly
scheduled Compensation Committee meetings or through actions taken by the Compensation Committee by
written consent between the dates of meetings according to a pre-determined schedule. The exercise prices of
options granted during the fiscal year were based on the closing trading price of our shares on the SWX Swiss
Exchange or the Nasdaq Global Select Market on the date of grant.
Employee Share Purchase Plans. Executive Officers are also eligible to participate in the Company’s
Employee Share Purchase Plans, under which employees may purchase shares with up to 10% of their earnings
at the lower of 85% of the fair market value at the beginning or the end of each offering period. Purchases under
the plans are limited to a fair value of $25,000 in any one year, calculated in accordance with U.S. tax laws.
There are two offering periods, each consisting of a six-month period during which payroll deductions of
employee participants are accumulated under the share purchase plan.
Deferred Compensation Plan. Executive Officers based in the United States are also eligible to participate
in the Logitech Inc. Management Deferred Compensation Plan, which is an unfunded and unsecured plan that
allows employees of Logitech Inc. earning more than a threshold amount the opportunity to defer U.S. taxes on
their base salary and bonus compensation. Logitech does not contribute to this plan. The Logitech Inc.
Management Deferred Compensation Plan is not intended to provide for the payment of above-market or
preferential earnings on compensation deferred under the plan. In fiscal year 2007 three Executive Officers
contributed to the plan. Four executives have balances in the plan based on contributions in the current and prior
fiscal years.
The Chief Executive Officer is not present at any deliberations or upon the vote of the Board to approve his
salary or equity compensation.
Non-Executive Director Compensation
The compensation of Logitech’s non-executive Directors is established by the Board Compensation
Committee (refer to section 3.5 above). The Board Compensation Committee reviews aggregate data on
non-executive Director compensation of comparable companies in setting compensation for Logitech’s
non-executive Directors.
Under the Company’s current policy, non-executive Directors are paid an annual retainer of $25,000, or
CHF 35,000 and receive $2,000, or CHF 2,500, for each board or committee meeting attended and also for each
day of travel to attend board or committee meetings. The Lead Independent Director receives a further retainer of
$10,000 per year. Annual service is measured between the dates of the Company’s Annual General Meetings.
The cash compensation is paid in arrears to each non-executive Board member after the Company’s Annual
General Meeting for their service on the Board in the prior year. All Directors are also reimbursed for business-
class travel and expenses in connection with attendance at Board and Committee meetings.
Each non-executive Director also receives options to purchase 30,000 of the Company’s shares upon their
election to the Board for a three-year term and options to purchase 15,000 shares upon their re-election to the
Board. These options are granted at the fair market value at the date of grant and become exercisable over three
years in equal annual installments.
Beginning with the 2007 Annual General Meeting the annual retainer for non-executive Board members
will increase to $30,000, or CHF 40,000, and the Chair of the Audit Committee will receive an additional retainer
of $12,000 or CHF 15,000. The additional retainer for the Lead Independent Director and the per meeting and
travel days compensation for non-executive Directors will remain the same.
Executive Directors do not receive any compensation for their service on the Board of Directors.
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