LeapFrog 2010 Annual Report Download - page 156

Bonus Award Decisions
In March 2011, our Chairman, Mr. Chiasson, recommended bonus awards for each of our named executive
officers (except for himself) for 2010, which recommendations were then reviewed and approved by the
compensation committee. With respect to Messrs. Dodd and Chai, since the corresponding calculations described
above led to a recommended bonus payout of less than their guaranteed bonus (of 100% of their target bonus),
the compensation committee approved payout of the guaranteed bonus amount, but no additional bonus payment
was approved for them. In the case of Mr. Chiasson, the compensation committee evaluated his performance for
the relevant period and approved his bonus awards.
The decisions of the compensation committee were based on its analysis of the achievement of the different
performance objectives of the company and, individually, for each of the named executive officers. With respect
to the Company performance component, the compensation committee determined that our named executive
officers were eligible for 28.25% of their target bonus opportunity (out of a possible 80%) based on achievement
of a portion of the net sales performance measures.
The compensation committee also conducted an evaluation of the individual performance of each named
executive officer, in part with respect to overall achievement of his respective goals for the year, and in part with
respect to the contributions and impact that his area of responsibility had on the performance of the Company.
Under the bonus plan, the board of directors and compensation committee had discretion to vary the amount of
the bonus awards paid to our named executive officers. With respect to the individual performance component,
Messrs. Chiasson and Etnyre were awarded 75% of the individual portion of their target bonus and Mr. Campbell
was awarded 50% of the individual portion of his target bonus.
Total Bonus Awards. Based on the foregoing, our named executive officers received the following cash
bonus awards for 2010:
Name
2010 Bonus Plan Elements and Payouts
Eligible
Compensation
($)
Target Bonus
Opportunity
(%$)
Incentive at
Target ($)
Net Sales
Component ($)
Operating
Income
Component ($)
Individual
Performance
Component ($)
Total Bonus
Paid ($)
Mr. Chiasson(1) .... 427,133 75% 320,350 72,399 — 48,053 120,452
Mr. Etnyre(1) ...... 291,667 50% 145,834 32,958 — 21,875 54,834
Mr. Dodd(2) ....... 408,000 75% 306,000 n/a n/a n/a 306,000
Mr. Campbell(1) .... 290,675 50% 145,338 32,846 — 14,534 47,380
Mr. Chai(2) ........ 361,188 75% 270,891 n/a n/a n/a 270,891
(1) With respect to Messrs. Chiasson, Etnyre and Campbell, their target bonus opportunity was based on their
actual compensation received for 2010, not their annual base salary at the time of computation of the bonus
award.
(2) With respect to Messrs. Dodd and Chai, in September 2010, the compensation committee guaranteed a
bonus payment at least equal to their target bonus opportunity based on their current base salary. Since they
were not eligible for more than 100% of their target bonus opportunity, based on achievement of only a
portion of the Company’s performance objectives, the payout of their target bonus was not dependent upon
attainment of the different components of the bonus award.
Equity Incentive Awards
We believe that equity incentives are an effective way to attract and retain talented executives, to motivate
and reward them for outstanding company and individual performance, and to align their interests with those of
our stockholders. The compensation committee grants equity awards to our executives on the basis of our overall
performance against short-term and long-term financial and strategic goals, the executive’s then-current equity
holdings, his or her anticipated future contributions to our success, and its assessment of the executive’s potential
to contribute to the long-term value of our company. In addition, these awards have been subject to equity award
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