Exhibit 10.11
CIRRUS LOGIC, INC.
2007 MANAGEMENT AND KEY INDIVIDUAL CONTRIBUTOR INCENTIVE
PLAN
Effective September 30, 2007
(as amended on February 15, 2008)
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Purpose . |
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The purposes of the Cirrus Logic, Inc. Management and Key
Individual Contributor Incentive Plan (the “Incentive
Plan”) are to (1) provide Participants with incentives
to improve the Company’s financial performance through the
achievement of semi-annual goals relating to the Company’s
Operating Profit Margin and Revenue Growth, and (2) attract,
retain, motivate and reward the Company’s management team and
key individual contributors. |
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| 2. |
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Definitions . |
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As used herein, the following definitions shall apply: |
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(A) |
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“ Base Salary ” means an Employee’s
annual rate of base salary, exclusive of bonuses, incentive pay,
commissions, and all other forms of compensation. Base Salary for a
given Plan Cycle shall be calculated based on Participants’
Base Salary in effect on the last day of a Plan Cycle. |
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(B) |
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“ Board ” means the Board of Directors of
Cirrus Logic, Inc. |
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(C) |
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“ Cause ” means (i) gross negligence or
willful misconduct in the performance of duties to the Company
after one written warning detailing the concerns and offering the
Employee opportunities to cure; (ii) material and willful
violation of any federal or state law; (iii) commission of any act
of fraud with respect to the Company; (iv) conviction of a
felony or any crime causing material harm to the standing and
reputation of the Company; or (v) intentional and improper
disclosure of the Company’s confidential or proprietary
information. |
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(D) |
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“ Change in Control ” means (i) the
sale, lease, conveyance or other disposition of all or
substantially all of the Company’s assets as an entirety or
substantially as an entirety to any person, entity or group or
persons acting in concert; (ii) any “person” (as
such term is used in Sections 13(d) and 14(d) of the Securities
Exchange Act of 1934, as amended) becoming the “beneficial
owner” (as defined in Rule 13d-3 under said Act),
directly or indirectly, of securities of the Company representing
50% or more of the total voting power represented by the
Company’s then outstanding voting securities; or (iii) a
merger or consolidation of the Company with any other corporation,
other than a merger or consolidation that would result in the
voting securities of the Company outstanding immediately prior
thereto continuing to represent (either by remaining outstanding or
by being converted into voting |
Cirrus Logic Inc. Executive Incentive Plan
September 30, 2007
Page 2 of 9
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securities of the surviving entity or its parent) at least 50%
of the voting power represented by the voting securities of the
Company or such surviving entity (or parent) outstanding
immediately after such merger or consolidation. |
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(E) |
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“ Code ” means the Internal Revenue Code of
1986, as amended. |
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(F) |
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“ Committee ” means the Compensation
Committee of the Board. |
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(G) |
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“ Company ” means Cirrus Logic, Inc. and its
wholly owned subsidiaries and affiliates, and each of their
respective successors. |
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(H) |
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“ Continuously Employed ” means the
Employee’s continuous and uninterrupted full-time employment
with the Company except for approved absences and other
interruptions approved by the Committee or pursuant to a formal
written Company policy. |
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(I) |
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“ Disability ” means total and permanent
disability as defined in accordance with the Company’s
Long-Term Disability Plan. |
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(J) |
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“ Effective Date ” means September 30,
2007. |
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(K) |
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“ Eligible Participant ” means any Employee
who is in a management or leadership position in the Company or who
is a key individual contributor whose efforts potentially have a
material impact on the Company’s performance. |
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(L) |
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“ Employee ” means a natural person who is
employed by the Company and who is treated as an employee by the
Company for tax purposes. |
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(M) |
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“ Incentive Plan Pay-Out Percentage ” means
the multiplier derived from the formula set forth by the Committee
before a Plan Cycle for determining the pay-out percentage based on
the Company’s Operating Profit Margin and Revenue Growth. The
Committee shall review and update the Operating Profit Margin and
Revenue Growth performance goals and the associated Incentive Plan
Pay-Out Percentages applicable to a Plan Cycle prior to the
commencement of such Plan Cycle. |
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(N) |
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“ Individual Incentive Payment ” means the
amount calculated for each Participant in Section 5 for each
Plan Cycle. |
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(O) |
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“ Individual Performance Multiplier ” means
a performance multiplier of between 0% and 120% to be determined
based on a Participant’s achievement of individual
performance goals (“MBOs”) set for each Participant
pursuant to Section 3(C). |
Cirrus Logic Inc. Executive Incentive Plan
September 30, 2007
Page 3 of 9
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(P) |
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“ Operating Profit Margin ” will be measured
as the Company’s consolidated GAAP operating income (revenue
minus cost of goods sold (COGS) minus research and development
(R&D) minus selling, general and administrative (SG&A),
excluding Incentive Plan and VCP accruals, if any, and any
Non-Recurring Items) as a percentage of revenue. The
Company’s GAAP operating income shall be determined based on
the Company’s financial results as approved by the
Company’s Audit Committee and filed with the Securities and
Exchange Commission on a Form 10Q or Form 10K. |
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(Q) |
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“ Non-Recurring Items ” include any unusual
or infrequent accounting items included in GAAP operating profits
such as: |
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(i) |
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gains on sales of assets not otherwise included in
revenue; |
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(ii) |
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losses on sales of assets, restructuring charges,
merger-related costs including amortization or impairment of
acquisition-related intangible assets, asset write-offs,
write-downs, and impairments whether or not included in COGS,
SG&A or R&D expenses; and |
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(iii) |
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such other items as the Committee may determine at its sole
discretion. |
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The Committee will determine, in its sole discretion, whether
to include or exclude any or all of the above described
Non-Recurring Items as part of Operating Profit Margin. |
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(R) |
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“ Participant ” means any Eligible
Participant designated by the Committee to participate in the
Incentive Plan for a Plan Cycle. |
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(S) |
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“Plan Administration Committee” means the
Company’s Chief Executive Officer, Chief Financial Officer,
and Vice President of Human Resources. |
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(T) |
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“ Plan Cycle ” means a period on or after
the Effective Date beginning on the first day of the
Company’s first fiscal quarter and ending on the last day of
the Company’s second fiscal quarter, or the period beginning
on the first day of the Company’s third fiscal quarter and
ending on the last day of the Company’s fourth fiscal
quarter. |
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(U) |
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“ Revenue Growth ” means the Company’s
year-over-year revenue growth based on the Company’s GAAP
revenue for a given Plan Cycle over the Company’s GAAP
revenue for the corresponding period from the prior fiscal year.
The Company’s GAAP revenue shall be determined based on the
Company’s financial results as approved by the
Company’s Audit Committee and filed with the Securities and
Exchange Commission on a Form 10Q or Form 10K. For
purposes of calculating Revenue Growth, the Committee shall exclude
any non-recurring revenue as |
Cirrus Logic Inc. Executive Incentive Plan
September 30, 2007
Page 4 of 9
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calculated by the Committee for purposes of determining the
Operating Profit Margin. To |
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