LeapFrog 2015 Annual Report Download - page 153

Key Executive Compensation Policies and Practices
Our compensation philosophy and related corporate governance policies and practices are complemented
by several specific compensation practices that are designed to align our executive compensation program with
long-term stockholder interests, including the following:
•Pay-for-performance alignment: We believe in maintaining a strong pay-for-performance
relationship for our named executive officers. The majority of the target total direct compensation
opportunities for all of our named executive officers is performance-based (includes performance
based bonuses and stock option compensation).
•Compensation At-Risk. Our executive compensation program is designed so that a significant
portion of the compensation of our named executive officers is ‘‘at risk’’ based on corporate
performance, as well as equity-based to align the interests of our named executive officers and
stockholders. For the Transition Period and Fiscal 2015, 63% of the average target total direct
compensation opportunities for our named executive officers (base salary + target annual bonus +
equity award) was at-risk (target annual bonus + equity award).
•No Retirement Plans. We do not currently offer, nor do we have plans to provide, pension
arrangements, retirement plans or nonqualified deferred compensation plans or arrangements to our
named executive officers.
•No Perquisites. We do not provide any perquisites or other personal benefits to our named
executive officers, other than relocation benefits.
•No Tax Reimbursements. We do not provide any tax reimbursement payments (including
‘‘gross-ups’’) on any perquisites or other personal benefits, other than in connection with relocation
benefits.
•No Special Health or Welfare Benefits. Our named executive officers participate in broad-based
company-sponsored health and welfare benefits programs on the same basis as our other full-time,
salaried employees in the countries in which they are employed.
•No Post-Employment Tax Reimbursements. We do not provide any tax reimbursement payments
(including ‘‘gross-ups’’) on any severance or change-in-control payments or benefits.
•Multi-Year Vesting Requirements. The equity awards granted to our named executive officers vest
or are earned over multi-year periods, consistent with current market practice and our retention
objectives.
Prior Say-on-Pay Vote
At our 2014 Annual Meeting of Stockholders, our stockholders had the opportunity to provide an
advisory vote on the compensation of our named executive officers, or a ‘‘say-on-pay’’ vote. Over 97% of the
votes cast by our stockholders approved the compensation of our named executive officers, as disclosed in our
2014 proxy statement. Our board of directors and compensation committee reviewed these vote results and
determined that such results affirmed stockholder support of our overall approach to executive compensation
and thus we have not made any changes to our executive compensation program or related policies directly in
response to the vote results.
At the time of our initial say-on-pay vote at our 2011 Annual Meeting of Stockholders, three years was
selected as the preferred frequency of future say-on-pay votes by over 90% of the votes cast. Accordingly, our
board of directors will not hold an advisory vote on the compensation of our named executive officers this
year. Consistent with the recommendation of our stockholders, our board of directors will next hold an
advisory vote on the compensation of our named executive officers in 2017. In addition, pursuant to SEC
regulations, our board of directors currently plans to hold its next vote on the preferred frequency of future
say-on-pay votes at the 2017 Annual Meeting of Stockholders.
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