Logitech 2013 Annual Report Download - page 47

3 times his annual base salary. Officers who report to the Chairman or Chief Executive Officer must hold a number
of Logitech shares with a market value equal to 2 times annual base salary. Officers subject to the guidelines are
required to achieve the guideline within three years of being appointed to the position making them subject to the
guideline, or, in the case of such officers serving at the time the guidelines were adopted, within three years of
the effective date of adoption of the guidelines. The guidelines will be adjusted to reflect any share splits or other
capital adjustments, and will be re-evaluated by the Compensation Committee from time to time. Up to 50% of the
guideline may be met through the net value of vested, unexercised stock options. If the guideline is not met within
3 years, the Chief Executive Officer must hold 100% of his after-tax shares resulting from option exercises or other
equity incentive awards until the guideline is reached, and all other Chairman or Chief Executive Officer direct
reports must hold at least 50% of the net shares resulting from option exercises or other equity incentive awards
until the guideline is reached. As of July 2, 2013, nine of the eleven executive officers and other officers who report
directly to the Chairman or Chief Executive Officer had either satisfied these ownership guidelines or had time
remaining to do so.
To support our goal of Logitech’s executive officers holding meaningful amounts of Logitech stock, in June
2011, the Compensation Committee adopted a provision, applicable to executive officers and Chairman or Chief
Executive Officer direct reports who have not met at least 75% of their stock ownership targets within three years
of being subject to the ownership requirements, to pay a portion, increasing over time, of any earned bonus under
the annual incentive bonus program in Logitech shares. These shares will be subject to the holding requirements
noted above. In fiscal year 2013, this provision was not used, as no bonuses were earned under the annual incentive
bonus program.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
OUR POLICIES
It is our policy that all employees must not engage in any activities which could conflict with Logitech’s
business interests, which could adversely affect its reputation or which could interfere with the fulfillment of the
responsibilities of the employee’s job, which at all times must be performed in the best interests of Logitech. In
addition, Logitech employees may not use their position with Logitech, or Logitech’s information or assets, for
their personal gain or for the improper benefit of others. These policies are included in our Conflict of Interest
and Business Ethics Policy, which covers our directors, executive officers and other employees. If in a particular
circumstance the Board concludes that there is or may be a perceived conflict of interest, the Board will instruct
our Legal department to work with our relevant business units to determine if there is a conflict of interest. Any
waivers to these conflict rules with regard to a director or executive officer require the prior approval of the
Audit Committee.
NASDAQ RULES AND SWISS BEST CORPORATE GOVERNANCE PRACTICES
NASDAQ rules defining “independent” director status also govern conflict of interest situations, as do Swiss
best corporate governance principles published by economiesuisse, a leading Swiss business organization. As
discussed above, the Board of Directors has determined that each of our directors and nominee to be a director,
other than Mr. Borel, Mr. Darrell and Mr. De Luca, qualifies as “independent” in accordance with the NASDAQ
rules. The NASDAQ rules include a series of objective tests that would not allow a director to be considered
independent if the director has or has had certain employment, business or family relationships with the company.
The NASDAQ independence definition also includes a requirement that the Board review the relations between
each independent director and the company on a subjective basis. In accordance with that review, the Board has
made a subjective determination as to each independent director that no relationships exist that, in the opinion of the
Board, would interfere with the exercise of independent judgment in carrying out the responsibilities of a director.
PROX Y STATEMENT
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