Logitech 2013 Annual Report Download - page 173

LOGITECH INTERNATIONAL S.A.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Note 4 — Employee Benefit Plans (Continued)
The following table summarizes share-based compensation expense and related tax benefit recognized for
fiscal years 2013, 2012 and 2011 (in thousands):
Year Ended March 31,
2013 2012 2011
Cost of goods sold . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 2,499 $ 3,620 $ 4,223
Share-based compensation expense included in gross profit . . . . . . . . . . . . . . . 2,499 3,620 4,223
Operating expenses:
Marketing and selling . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,825 12,716 12,030
Research and development. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,532 7,187 7,829
General and administrative . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,342 8,006 10,764
Share-based compensation expense included in operating expenses . . . . . . . . . 22,699 27,909 30,623
Total share-based compensation expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25,198 31,529 34,846
Income tax benefit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,356 6,294 8,279
Share-based compensation expense, net of income tax . . . . . . . . . . . . . . . . . . . . $19,842 $25,235 $26,567
As of March 31, 2013, 2012 and 2011, $0.4 million, $0.7 million and $1.0 million of share-based compensation
cost were capitalized in inventory. The following table summarizes total share-based compensation cost not yet
recognized and the number of months over which such cost is expected to be recognized, on a weighted-average
basis by type of grant (in thousands, except number of months):
March 31, 2013
Compensation
Cost Not Yet
Recognized
Months of
Future
Recognition
Non-vested stock options . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 3,767 10
Premium-priced stock options . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,015 36
Performance stock options . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,556 21
Time-based RSUs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31,152 21
Performance-based RSUs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,184 13
Total compensation cost not yet recognized . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $44,674
Under the 1996 ESPP and 2006 ESPP plans, eligible employees may purchase shares at the lower of 85% of the
fair market value at the beginning or the end of each six-month offering period. Subject to continued participation
in these plans, purchase agreements are automatically executed at the end of each offering period. An aggregate of
21,000,000 shares was reserved for issuance under the 1996 and 2006 ESPP plans. As of March 31, 2013, a total of
2,316,415 shares were available for issuance under these plans.
The 2006 Plan provides for the grant to eligible employees and non-employee directors of stock options,
stock appreciation rights, restricted stock and RSUs. Awards under the 2006 Plan may be conditioned on continued
employment, the passage of time or the satisfaction of performance vesting criteria. The 2006 Stock Plan has an
expiration date of June 16, 2016. Stock options granted under the 2006 Plan generally vest over three years for non-
executive Directors and over four years for employees. All stock options under this plan have terms not exceeding
ten years and are issued at exercise prices not less than the fair market value on the date of grant. Time-based
RSUs granted to employees under the 2006 Plan generally vest in four equal annual installments on the grant date
anniversary. Time-based RSUs granted to non-executive board members under the 2006 Plan vest in one annual
installment on the grant date anniversary. Performance-based options and RSUs granted under the 2006 Plan vest
ANNUAL REPORT
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