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This excerpt taken from the BRCD DEF 14A filed Feb 23, 2007. Directors’
Compensation
Cash Compensation. Our directors play a
critical role in guiding the Company’s strategic direction
and overseeing the management of the Company. The increased
demand for qualified and talented public company directors
requires that we provide adequate incentives for our
directors’ continued performance and participation. For
fiscal year 2006, each of our non-employee directors received a
$25,000 annual retainer for serving as a board member. Each
member of a committee of the Board also received additional fees
as set forth below for his service on each committee of the
Board and for serving as a chairperson of a committee (in
addition to the fee for serving as a member of a committee):
We are also authorized to reimburse directors for expenses in
connection with attendance at meetings.
In February 2006, the Nominating and Corporate Governance
Committee of the Board of Directors approved a one-time payment
of $100,000 to David House, Chairman of the Board of Directors,
in recognition of his special assistance and service to the
Board and its various committees during 2005.
Equity Compensation. Non-employee directors
also participated in the Company’s 1999 Director
Option Plan (the “Director Plan”) which provides for
automatic option grants to directors for their service to the
Company. Only non-employee directors may participate in the
Director Plan.
The Director Plan provides for the following automatic grants of
options to each non-employee director:
All options granted under the Director Plan have a term of
10 years. The exercise price of options granted under the
Director Plan is 100 percent of the fair market value of
the Common Stock, as determined by reference to the closing
sales price of the Company’s Common Stock as reported on
the Nasdaq Global Select Market on the date of grant.
In the event of a merger or the sale of substantially all of the
assets of the Company, and if the option is not assumed or
substituted, each option granted under the Director Plan becomes
fully vested and exercisable. In such event, the Board of
Directors shall notify the option holder that the option will be
fully exercisable for a period of 30 days from the date of
the notice. Upon expiration of the
30-day
period, the option shall terminate. If the option is assumed or
substituted, and the option holder’s status as a director
of Brocade or the successor corporation, as applicable, is
terminated other than upon a voluntary resignation by such
option holder, the option shall be accelerated and become fully
exercisable with respect to all shares.
Table of Contents
Options granted under the Director Plan may be exercised within
3 months following the date a director’s board service
terminates, or within 12 months if termination of service
was due to death or disability, but only to the extent that the
director was entitled to exercise the option on the date of
termination. If an option is not exercised within such 3 or
12-month
time period, as applicable, the option shall terminate. In any
event, a director may not exercise any option later than the
expiration of the option’s ten-year term.
This excerpt taken from the BRCD DEF 14A filed Feb 24, 2006. Directors’
Compensation
Cash Compensation. Our directors play a
critical role in guiding the Company’s strategic direction
and overseeing the management of the Company. The increased
demand for qualified and talented public company directors
requires that we provide adequate incentives for our
directors’ continued performance and participation. For
fiscal year 2005, each of our non-employee directors received a
$25,000 annual retainer for serving as a board member and
additional fees as set forth below for serving as a chairperson
and/or a member of one or more committees of the Board:
We are also authorized to reimburse directors for expenses in
connection with attendance at meetings.
In fiscal year 2006 and until changed by action of the
appropriate Board committee, each of our non-employee directors
will receive the fees noted above, except that we will no longer
have a Lead Director but rather an independent Chairman of the
Board. Our independent Chairman will receive an annual retainer
of $30,000 in addition to fees he may be eligible to receive as
set forth above.
Table of Contents
In February 2006, the Nominating and Corporate Governance
Committee of the Board of Directors approved a one-time payment
of $100,000 to David House, Chairman of the Board of Directors,
in recognition of his special assistance and service to the
Board and its various committees during 2005.
Equity Compensation. Non-employee directors
also participated in the Company’s 1999 Director
Option Plan (the “Director Plan”) which provides for
automatic option grants to directors for their service to the
Company. Only non-employee directors may participate in the
Director Plan.
The Director Plan provides for the following automatic grants of
options to each non-employee director:
Mr. House was not eligible to receive an automatic grant
under the Director Plan for fiscal year 2005 since, at the time
of the proposed grant, he was Executive Chairman of the Board of
Directors. He no longer serves as Executive Chairman and is
eligible to receive grants under the Director Plan in fiscal
year 2006.
All options granted under the Director Plan have a term of 10
years. The exercise price of all options is 100 percent of
the fair market value of the Common Stock, generally determined
with reference to the closing price of the Common Stock as
reported on the Nasdaq National Market on the date of grant.
In the event of a merger or the sale of substantially all of the
assets of the Company, and if the option is not assumed or
substituted, each option granted under the Director Plan becomes
fully vested and exercisable for a period of 30 days after
notice is provided. If the option is not exercised within the
30-day period, the option will then terminate. Options granted
under the Director Plan must be exercised within 3 months
after the director’s board service terminates, or within
12 months if termination of service was due to death or
disability, but only to the extent that the director was
entitled to exercise the option on the date of termination. In
any event, a director may not exercise any option later than the
expiration of the option’s ten-year term.
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