Logitech 2003 Annual Report Download - page 85

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OUR CORPORATE GOVERNANCE
As a company whose shares are traded both on the Swiss Exchange and on the Nasdaq National Market,
Logitech’s commitment to corporate governance practices is guided by the legal and regulatory requirements of both
Switzerland and the United States. In addition, Logitech’s internal guidelines regarding corporate governance are
provided in its Articles of Incorporation, Organizational Regulations, and Board Committee Charters. The current
roles of the Board and its Committees are outlined in the following pages.
This report conforms with the new Directive on Information relating to Corporate Governance published by the
Swiss Exchange on July 1, 2002. If there is an item listed in the SWX Directive that is not addressed in this report,
the item is either inapplicable to, or immaterial for, Logitech.
Group structure and shareholders
Logitech International SA directly or indirectly owns 100% of all Logitech subsidiaries. Principal operating
subsidiaries include the following: Logitech Inc., Logitech Europe S.A., Logitech Far East Ltd., and Suzhou
Logitech Electronic Co. Ltd. For a complete list of our subsidiaries refer to Exhibit 8.1. Logitech registered shares
are listed on the Swiss Exchange. Logitech’s American Depositary Shares (“ADSs”) are listed on the Nasdaq
National Market system. One subsidiary, Logitech (Jersey) Ltd., is the issuer of the convertible bonds, which are
listed on the Swiss Exchange.
Significant shareholders
To the knowledge of the Company, the two beneficial owners holding more than 5% of the voting rights of the
Company at March 31, 2003 are Daniel Borel who with his wife, Sylviane Borel, owns 6.8% and Fidelity
Investments which owns 5.8% at March 31, 2003.
Cross-shareholdings
The Company has no share holdings in companies which have shareholdings in Logitech.
Capital structure
The Company’s only class of capital stock outstanding is registered shares with a par value of one Swiss Franc
per share. As of March 31, 2003, our share capital was CHF 47,901,655 (approximately $33,370,000) consisting of
47,901,655 registered shares that are issued and outstanding.
In June 2002, the shareholders authorized the Board to increase the share capital of the Company by CHF 10
million through the issuance of 10 million registered shares of par value one CHF. This authorization will expire on
June 27, 2004. The Board of Directors may exclude the preferential subscription right of the shareholders, in
particular if these shares are issued in connection with an acquisition of or merger with another company.
The shareholders also approved an increase of 6 million shares in the conditionally authorized share capital.
This increase when added to the unused conditional shares, equals 15,165,465 registered shares that may be used to
cover the issuance of stock in connection with the exercise of stock options and employee stock purchase plans. In
June 2001, 2,725,000 shares were conditionally authorized to cover the conversion rights associated with the issue of
the convertible bond.
In June 2001, the Company’s shareholders approved a ten-for-one share split for shares traded on the Swiss
Exchange, which took effect on August 2, 2001 and was distributed to stockholders of record as of August 1, 2001.
ADSs traded on Nasdaq were not affected. As a result, the ratio of ten ADSs to one registered share changed to a new
ratio of one ADS to one registered share.
In June 2002, the Company repurchased 88,000 shares for $3.8 million in open market transactions under a stock
buyback program. In July 2002, the Company announced a program to buy back up to CHF 75 million
(approximately $52 million) of Logitech shares in a twelve-month period. In fiscal year 2003, the Company
completed this buy back program with the repurchase of 1,509,000 shares for $52.4 million. In February 2003, the
Board of Directors authorized the repurchase of up to CHF 75 million (approximately $55 million) of the Company’s
registered shares over the next twelve months. Under this program, as of March 31, 2003, the Company has
repurchased 238,000 shares for CHF 10.3 million ($7.6 million).
There are no limitations on transferability of our shares or shares held by a nominee.
Convertible Bonds
In June 2001, Logitech sold CHF 170,000,000 (US $95,625,000) aggregate principal amount of its 1%
Convertible Bonds which mature in 2006. The convertible bonds were issued in denominations of CHF 5,000 at par
value, with interest at 1.00% payable annually, and final redemption in June 2006 at 105%, representing a yield to
maturity of 1.96%. The convertible bonds are convertible at any time into shares of Logitech registered shares at the