LogMeIn, Inc. (NASDAQ:LOGM) Files An 8-K Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers
Item5.02
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Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
Compensatory Arrangements with Certain
Officers
On February14, 2017, the Board of Directors (the Board) of
LogMeIn, Inc. (the Company) approved the following compensation
programs and benefits for the Companys executive officers for
fiscal 2017, as recommended by the Boards Compensation Committee
(the Committee):
Fiscal 2017 Executive Compensation
Base Salaries
The base salaries of the Companys executive officers are reviewed
at least annually by the Committee and the Board and are adjusted
from time-to-time to align with current market practices and
trends, while also taking into consideration the Companys overall
performance and the individual executive officers
responsibilities, past performance, future expectations and
experience.
The following table sets forth the fiscal 2017 salary for our
2017 executive officers:
|
Name |
2017BaseSalary | |||
|
William R. Wagner President Chief Executive Officer |
$ | 580,000 | (1) | |
|
Edward K. Herdiech Chief Financial Officer Treasurer |
$ | 400,000 | (1) | |
|
Christopher Battles* Chief Product Officer |
$ | 360,000 | (2) | |
|
Lawrence M. DAngelo SVP, Sales |
$ | 360,000 | (1) | |
|
Michael J. Donahue SVP, General Counsel Secretary |
$ | 340,000 | (1) | |
|
W. Sean Ford Chief Marketing Officer |
$ | 340,000 | (1) | |
|
James Lok* SVP, Engineering |
$ | 360,000 | (2) |
| * | New Section16 officer for fiscal 2017 |
| (1) | Salary effective as of January1, 2017 |
| (2) | Salary effective as of February1, 2017 |
Annual Cash Incentive Bonus
In additional to their base salaries, the Companys executive
officers are entitled to participate in the Companys annual cash
incentive bonus program. Annual cash incentive bonuses are
intended to compensate executives for the Companys achievement of
strategic, operational and financial goals. Amounts payable are
discretionary and are typically calculated as a percentage of the
applicable executives base salary, with higher ranked executives
typically being compensated at a higher percentage of their base
salary. At the beginning of each fiscal year, the Committee
establishes a target performance level for the Company based on
the Companys satisfaction of certain performance metrics which
are set in advance by the Committee. Typically, these cash
incentive bonuses are paid after the completion of the applicable
fiscal year, based on the Companys actual performance versus the
established performance metrics. In the event that the Companys
actual performance exceeds or falls short of the target
performance level, bonus amounts are increased or decreased
accordingly.
The following table sets forth the potential bonus amounts that
may be earned by our 2017 executive officers, assuming
achievement of 50% of the 2017 targets, which have been based on
the strategic, operational and financial goals set by the
Committee for the 2017 fiscal year:
|
Name |
Potential 2017Cash IncentiveBonus(1) | |||
|
William R. Wagner President Chief Executive Officer |
$ | 580,000 | ||
|
Edward K. Herdiech Chief Financial Officer Treasurer |
$ | 200,000 | ||
|
Christopher Battles* Chief Product Officer |
$ | 180,000 | ||
|
Lawrence M. DAngelo SVP, Sales |
$ | 360,000 | (2) | |
|
Michael J. Donahue SVP, General Counsel Secretary |
$ | 170,000 | ||
|
W. Sean Ford Chief Marketing Officer |
$ | 170,000 | ||
|
James Lok* SVP, Engineering |
$ | 180,000 |
| * | New Section16 officer for fiscal 2017 |
| (1) |
Amounts reported assume the Companys achievement of 50% of the target performance level established by the Committee. The annual cash incentive bonuses awarded to the Companys executive officers for fiscal 2017 will also be subject to the Companys executive compensation recovery, or clawback, policy, which requires the reimbursement of excess incentive-based cash compensation provided to our executive officers in the event of certain restatements of our financial statements. |
| (2) |
As the Companys SVP of Sales, Mr.DAngelos cash incentive bonus is commission-based and tied to the Companys achievement of certain Board-specified sales goals. |
Executive Severance Benefit
Upon the recommendation of the Committee, the Board approved a
general executive severance program, to which the Companys
executives would be entitled to receive a severance benefit equal
to one (1)times their base salary and 12 months of COBRA
insurance coverage in the event that their employment was
terminated by the Company either without Cause or by themselves
for Good Reason.
The Board also approved an additional executive severance program
in the event of a Change of Control. In the event either
Mr.Wagner or Mr.Herdiech, as CEO and CFO respectively, were to be
terminated within 24 months of a Change of Control either without
Cause or by himself for Good Reason, Mr.Wagner and Mr.Herdiech
would be entitled to receive a severance benefit equal to two
(2)times their base salary and target cash incentive bonus
amount, plus 24 months of COBRA insurance coverage and full
acceleration of any unvested RSU awards. All other executives
would be entitled to receive a severance benefit equal to one
(1)times their base salary and target cash incentive bonus
amount, plus 12 months of COBRA insurance coverage and full
acceleration of any unvested RSU awards if they were terminated
within 24 months of a Change of Control either without Cause or
by himself for Good Reason.
As used above:
| (1) |
a Change in Control means the sale of all or substantially |
|
outstanding securities entitled to vote generally in the election of directors of the resulting, surviving or acquiring corporation in such transaction). |
| (2) |
Cause means (a)a good faith finding by a majority of the Board that (i)the executive has failed to perform his or her reasonably assigned material duties for the Company and, if amenable to cure, has not cured such failure after reasonable notice from the Company; (ii)the executive has engaged in gross negligence or willful misconduct, which has or is expected to have a material detrimental effect on the Company, (iii)the executive has engaged in fraud, embezzlement or other material dishonesty, (iv)the executive has engaged in any conduct which would constitute grounds for termination for material violation of the Companys policies in effect at that time and, if amenable to cure, has not cured such violation after reasonable notice from the Company; or (v)the executive has breached any material provision of any nondisclosure, invention assignment, non-competition or other similar agreement between the executive and the Company and, if amenable to cure, has not cured such breach after reasonable notice from the Company; or (b)the conviction by the Company of, or the entry of a pleading of guilty or nolo contendere by the executive to, any crime involving moral turpitude or any felony. |
| (3) |
Good Reason means the occurrence, without the executives written consent, of any of the following events or circumstances: (a)the assignment to the executive of duties that involve materially less authority and responsibility and are materially inconsistent with the executives position, role, authority or responsibilities in effect immediately prior to the earliest to occur of (i)the Change in Control or (ii)the date of the execution by the Company of the initial written agreement or instrument providing for the Change in Control; (b)the relocation of the executives primary place of business to a location that results in an increase in the executives daily one way commute of at least 30 miles; (c)the material reduction of the executives annual salary (including base salary, commissions or bonuses) without the executives prior consent; or (d)the failure of the Company to obtain the agreement from any successor to the Company to assume and agree to perform any retention agreement of the executive. Notwithstanding the occurrence of any of the foregoing events or circumstances, such occurrence shall not be deemed to constitute Good Reason unless (x)the executive gives the Company a notice of termination no more than 90 days after the initial existence of such event or circumstance and (y)such event or circumstance has not been fully corrected and the executive has not been reasonably compensated for any losses or damages resulting therefrom within 30 days of the Company receipt of the notice of termination. |
Executive RSU Grant
The Board also approved the following executive RSU awards
comprised of 50% time-based RSUs and 50% performance-based RSUs,
or PRSUs, which have a vesting condition tied to the Companys
achievement of an Adjusted EBITDA Margin goal, as described
further below:
|
Name |
Time-Based RSUs(1) | Performance-Based RSUs(2) | ||||||
|
William R. Wagner President Chief Executive Officer |
14,078 | 14,078 | ||||||
|
Edward K. Herdiech Chief Financial Officer Treasurer |
5,922 | 5,922 | ||||||
|
Christopher Battles* Chief Product Officer |
9,951 | 9,951 | ||||||
|
Lawrence M. DAngelo SVP, Sales |
5,680 | 5,680 | ||||||
|
Michael J. Donahue SVP, General Counsel Secretary |
4,854 | 4,854 | ||||||
|
W. Sean Ford Chief Marketing Officer |
4,490 | 4,490 | ||||||
|
James Lok* SVP, Engineering |
8,325 | 8,325 |
| * | New Section16 officer for fiscal 2017 |
| (1) |
All time-based RSUs have a vesting commencement date of |
|
executive continuing to be an employee, officer or director of, or consultant or advisor to, the Company on the vesting date. |
| (2) |
All PRSUs have a vesting commencement date of February14, 2017. 50% of shares subject to the PRSUs shall vest on the two-year anniversary of the vesting commencement date subject to (a)the Companys achievement of a specified Adjusted EBITDA Margin target as measured over two performance periods, with 50% of the PRSU subject to the performance period starting on January1, 2017 and ending on December31, 2017 (the 2017 performance period) and the remaining 50% of the PRSU subject to the performance period starting on January1, 2018 and ending on December31, 2018 (the 2018 performance period); and (b)the executive continuing to be an employee, officer or director of, or consultant or advisor to, the Company on the vesting date. If the Adjusted EBITDA Margin target is not achieved in either the 2017 performance period or the 2018 performance period, the portion of the PRSUs subject to that performance period shall be forfeited. As used herein, Adjusted EBITDA Margin shall be calculated by dividing Adjusted EBITDA by non-GAAP revenue.Adjusted EBITDA is GAAP net income (loss) excluding income tax expense (benefit); interest, and other (income) expense, net (including any non-cash cumulative translation adjustment gains and losses); depreciation and amortization; impact of fair value acquisition accounting adjustment on acquired deferred revenue; acquisition-related costs (including transaction fees, due diligence costs, professional fees, severance, retention bonuses, integration-related costs, and subsequent adjustments to our initial estimated amount of contingent consideration associated with acquisitions); stock-based compensation expense; restructuring charges; and litigation related expense.Non-GAAP revenue is GAAP revenue excluding the impact of fair value acquisition accounting adjustment on acquired deferred revenue. |
About LogMeIn, Inc. (NASDAQ:LOGM)
LogMeIn, Inc. provides a portfolio of cloud-based service offerings, which helps people and businesses to connect to their workplace, colleagues and customers. The Company’s product line includes AppGuru, BoldChat, Cubby, join.me, LastPass, LogMeIn Pro, LogMeIn Central, LogMeIn Rescue, LogMeIn Rescue+Mobile, LogMeIn Backup, LogMeIn for iOS, LogMeIn Hamachi, MeldiumTM, Xively and RemotelyAnywhere. The Company’s services are focused on markets, such as identity and access management, collaboration and the Internet of Things, and are delivered through the cloud as hosted services, commonly called software-as-a-service (SaaS). The Company offers both free and fee based, or premium, services. The Company’s core cloud-based services are categorized into business lines, including Collaboration, Service and Support, Identity and Access Management, and Connected Products. It also offers annual maintenance services that include software upgrades and support services for this application. LogMeIn, Inc. (NASDAQ:LOGM) Recent Trading Information
LogMeIn, Inc. (NASDAQ:LOGM) closed its last trading session up +0.25 at 95.85 with 874,515 shares trading hands.