Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain
Officers; Compensatory Arrangements of Certain Officers.
Chief Executive Officer Base Salary Increase
On June 27, 2016, the Compensation and Leadership Resources Committee (the
Committee
) of the Board of Directors of
Advanced Micro Devices, Inc. (the
Company
) recommended, and the Board of Directors of the Company (the
Board
) approved, a salary increase for Dr. Lisa T. Su, the Companys President and Chief
Executive Officer. Beginning July 1, 2016, Dr. Sus annual salary will increase by $75,000 to $925,000, as compared to her current annual salary of $850,000.
Named Executive Officer Long-Term Incentive Awards
On June 27, 2016, the Committee recommended, and the Board approved, an equity award to Dr. Su having the following target value
(
Target Value
):
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Name and Title
|
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Target Value
|
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Lisa T. Su, President and Chief Executive Officer
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$
|
7,000,000
|
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On the same day, the Committee approved equity awards to the following named executive officers (as set forth
in the Companys most recent proxy statement filed with the U.S. Securities and Exchange Commission on March 24, 2016) having the following Target Values:
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Name and Title
|
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Target Value
|
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Devinder Kumar, Senior Vice President, Chief Financial Officer and Treasurer
|
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$
|
2,000,000
|
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Jim Anderson, Senior Vice President and General Manager, Computing and Graphics Business
Group
|
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$
|
2,000,000
|
|
Forrest E. Norrod, Senior Vice President and General Manager, Enterprise, Embedded and Semi-Custom
Business Group
|
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$
|
2,000,000
|
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Mark D. Papermaster, Chief Technology Officer and Senior Vice President, Technology and
Engineering
|
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$
|
2,000,000
|
|
The Target Value of each equity award will be converted into a mix of performance-based restricted stock units
(
PRSUs
), time-based restricted stock units (
RSUs
) and stock options:
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The actual number of PRSUs will be determined by dividing 50% of the Target Value by the greater of: (a) $3.50 or (b) the average closing price of the Companys stock over the 30 calendar-day period
ending on July 15, 2016 (the
Conversion Price
). The PRSUs will have a grant date of July 15, 2016.
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The actual number of stock options will be determined by converting the 25% of the Target Value using the Conversion Price and a binomial factor determined in accordance with the Companys equity valuation
practices. The stock options will have a grant date of July 26, 2016.
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The actual number of RSUs will be determined by dividing 25% of Target Value by the Conversion Price. The RSUs will have a grant date of July 15, 2016.
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PRSUs
.
The number
of PRSUs that may be earned, if at all, is based on three-year compounded annual growth rate milestones related to the Companys closing stock price that may be attained within the three-year performance period that begins July 15, 2016,
and ends August 9, 2019 (the
Performance Period
), with the potential payout levels of PRSUs at 50%, 100%, 150%, 200% and 250% of the target number of PRSUs granted.
Any PRSUs earned pursuant to the attainment of a performance level will vest and be paid out 50%
upon the Committees certification of the attainment of the performance level (provided, that no PRSUs will vest before the first anniversary of the grant date) and the remaining 50% will vest and be paid out at the end of the Performance
Period, subject to the recipients continuous employment or service through each such vesting date.
Stock Options
.
The stock options will have an exercise price equal to 100% of the fair market value of the Companys common stock on the grant
date, and will vest 33 1/3% on the first anniversary of the grant date, and 8.33% per quarter over the next eight following quarters. The stock options will have a term of seven years.
RSUs
.
The RSUs
will vest 1/3 on each of August 9, 2017, August 9, 2018 and August 9, 2019.