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Delaware
(State
or other jurisdiction
of
incorporation)
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1-12696
(Commission
File No.)
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77-0207692
(I.R.S.
Employer
Identification
Number)
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¨
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Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
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| Item 5.02 Compensatory Arrangements of Certain Officers |
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During
the employment period (the “Employment Period”), Mr. Kannappan will serve
as the Company’s President and Chief Executive Officer. The
Employment Period under the CEO Employment Agreement will begin upon the
Effective Date (as defined in the CEO Employment Agreement) and will
continue for a period of one (1) year with subsequent one (1) year terms
unless the CEO Employment Agreement is terminated in accordance with its
terms or either party provides notice of non-renewal at least ninety (90)
days prior to the end of the then current term. If a Change of
Control (as defined in the CEO Employment Agreement) occurs at any time
during the Employment Period, the term of the CEO Employment Agreement
will extend automatically for twenty-four (24) months from the date of the
Change of Control.
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·
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During
the Employment Period, Mr. Kannappan will receive a base salary at a rate
not less than $627,000 annually and he will be eligible to receive
quarterly and annual bonuses based upon achieving certain financial
criteria set by the Compensation Committee of the Company’s Board of
Directors.
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·
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If
Mr. Kannappan voluntarily reduces his compensation as a cost reduction
measure, his continued cash compensation in such case shall not be
calculated as above, but shall equal seventy-five percent (75%) of the
average of the cash compensation earned in the number of full fiscal
quarters as specified above as if the voluntary reduction was not
implemented (the “Voluntary Compensation”). To remove any
ambiguity in calculating the foregoing amount, after the foregoing
payments are completed, Mr. Kannappan shall have received a total of 1.5
times the average of the cash compensation payments earned in the number
of full fiscal quarters as specified above (disregarding any
voluntary reduction of Mr. Kannappan’s cash
compensation).
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·
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If
the Company terminates Mr. Kannappan’s employment without Cause or if Mr.
Kannappan resigns from such employment for Good Reason (as defined in the
CEO Employment Agreement), and such termination
occurs on or within twenty-four (24) months after a Change of
Control, and
Mr. Kannappan signs and does not revoke a release of claims with the
Company, then Mr. Kannappan shall receive the following: (i)
his accrued but unpaid compensation; (ii) a severance payment equal to the
sum of (A) three hundred percent (300%) of his annual base
salary in effect immediately prior to the termination date or (if greater)
at the level in effect immediately prior to the Change of Control; (B) one
hundred percent (100%) of his quarterly target incentive bonus; and (C)
one hundred percent (100%) of his annual target incentive bonus; and (iii)
if Mr. Kannappan elects continuation coverage pursuant to COBRA or other
applicable law, the Company shall reimburse Mr. Kannappan for the cost of
premiums for such coverage for the earlier of thirty-six (36) months or
the date upon which Mr. Kannappan and his eligible dependents become
covered under similar plans. The CEO Employment Agreement provides
that, if Mr. Kannappan is entitled to receive both the severance as a
result of a termination other than for Cause (including the Voluntary
Compensation) and the compensation described in this paragraph, he shall
be entitled to receive either such payment which yields him the greatest
economic benefit.
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·
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In
the event of a Change of Control, and subject to Mr. Kannappan’s continued
employment with the Company through the effective date of the Change of
Control, all outstanding equity awards will vest in full as to one hundred
percent (100%) of the unvested portion of the award. In the
event of an Involuntary Termination (as defined in the CEO Employment
Agreement) (other than for Cause) or a termination due to Mr. Kannappan’s
death or disability, the vesting of Mr. Kannappan’s equity awards will
accelerate for that portion of such awards that would have vested had Mr.
Kannappan’s employment continued for an additional eighteen (18)
months. If Mr. Kannappan voluntarily resigns following the
Effective Date, he will receive an additional twelve (12) months
accelerated vesting of his equity
awards.
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·
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Termination Other than for Cause - Mr. Kannappan's receipt of severance upon a termination other than for Cause is now conditioned on Mr. Kannappan signing and not revoking a release of claims with the Company in accordance with the timing requirements set forth in the CEO Employment Agreement. In addition, the calculation of his cash compensation for purposes of determining severance (including Voluntary Compensation) has been modified so that during fiscal year 2011, the time period for calculating seventy-five percent (75%) of the average of the cash compensation earned shall be measured by the cash compensation earned in the eight (8) full fiscal quarters immediately preceding the Termination Date and in fiscal year 2012 and thereafter, the time for calculating seventy-five percent (75%) of the average cash compensation earned shall be measured by the cash compensation earned in the twelve (12) full fiscal quarters preceding the Termination Date. If Mr. Kannappan breaches certain obligations under the CEO Employment Agreement (including confidentiality provisions and his Convenant Not to Compete or Solicit), the Company will be entitled to a refund of the severance compensation paid to Mr. Kannappan. |
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During
the time Mr. Kannappan is employed by the Company, the Company shall pay
for a disability insurance policy that will pay to Mr. Kannappan upon his
termination from the Company by reason of Disability (as defined in the
CEO Employment Agreement) a benefit of one million five hundred thousand
dollars ($1,500,000) payable in accordance with the terms of such
policy.
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(d)
Exhibits
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Number
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Description
of Document
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10.1
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Second
Amended and Restated Employment Agreement dated November 17, 2009 between
the Company and S. Kenneth Kannappan
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Date:
November 23, 2009
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PLANTRONICS,
INC.
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By:
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/s/
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Name:
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Barbara
Scherer
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Title:
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Senior
Vice President and Chief Financial Officer (Principal Financial
and Accounting Officer)
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Exhibit
Index
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Description
of Document
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10.1
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