Netgear 2011 Annual Report Download - page 105

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Table of Contents
Performance awards may be in the form of performance shares or performance units. A performance share means an award denominated in
shares of Company common stock and a performance unit means an award denominated in units having a dollar value or other currency, as
determined by the plan administrator. The plan administrator will determine the number of performance awards that will be granted and will
establish the performance goals and other conditions for payment of such performance awards. The period of measuring the achievement of
performance goals will be a minimum of twelve (12) months.
Other stock-based awards may be granted under the 2006 Plan subject to the terms specified by the plan administrator. Other stock-based
awards may include dividend equivalents, restricted stock awards, or amounts which are equivalent to all or a portion of any federal, state, local,
domestic or foreign taxes relating to an award, and may be payable in shares, cash, other securities or any other form of property as the plan
administrator may determine.
In the event of a change in control of the Company, all awards under the 2006 Plan vest in full and all outstanding performance shares and
performance units will be paid out upon transfer.
Any shares of common stock subject to an award that is forfeited, settled in cash, expires or is otherwise settled without the issuance of
shares shall again be available for awards under the 2006 Plan. Additionally, any shares that are tendered by a participant of the 2006 Plan or
retained by the Company as full or partial payment to the Company for the purchase of an award or to satisfy tax withholding obligations in
connection with an award shall no longer again be made available for issuance under the 2006 Plan.
The number of “full value equity awards” (as defined below) that may be granted will be limited to no more than ten percent (10%) of the
shares issuable under the 2006 Plan. For these purposes, a “full value equity award” is any award pursuant to the 2006 Plan, other than options,
stock appreciation rights or other awards which are based solely on an increase in value of the Company’s common stock following the date of
grant.
Employee Stock Purchase Plan
The Company sponsors an Employee Stock Purchase Plan (the “ESPP”), pursuant to which eligible employees may contribute up to 10%
of compensation, subject to certain income limits, to purchase shares of the Company’s common stock. Employees may purchase stock semi-
annually at a price equal to 85% of the fair market value on the purchase date. Since the price of the shares is determined at the purchase date,
the Company recognizes expense based on the 15% discount at purchase. For the years ended December 31, 2011, 2010 and 2009, ESPP
compensation expense was $354,000, $236,000 and $184,000, respectively. As of December 31, 2011, 450,669 shares were reserved for future
grants under the ESPP.
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