Tessera Technologies, Inc. (NASDAQ:TSRA) (the "Company") today announced a unanimous agreement by the Company’s Board of Directors and its Compensation Committee to amend its compensation arrangement with Robert A. Young, president and chief executive officer, giving him incentive to pursue the possibility of a business segment spin-off, which is a key strategic alternative within the Board’s long-term plan.
The Company’s Board of Directors has structured the equity portion of Young’s 2012 compensation to be contingent upon the successful completion of a spin-off of a business segment on or before March 31, 2015. If the Company completes such a spin-off, Young will be eligible for the immediate vesting of 550,000 stock options with an exercise price equal to the closing price of the Company’s common stock on Oct. 2, 2012.
“The 2012 compensation arrangement provides an additional financial incentive for Bob to pursue a key strategic alternative, and reflects the Board’s continuing efforts to closely align executive compensation with the best interests of stockholders,” said Robert J. Boehlke, chairman of the Board of Directors.
Additional detail regarding the revised compensation arrangement will be provided by the Company on a Form 8-K to be filed with the Securities and Exchange Commission.
Safe Harbor Statement
This press release contains forward-looking statements, which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve risks and uncertainties that could cause actual results to differ significantly from those projected, particularly with respect to the new CEO compensation arrangement, the possibility and timing of a business segment spin-off, the Board’s long term plans and the Company’s strategic alternatives. Material factors that may cause results to differ from the statements made include the plans or operations relating to the Company's businesses; market or industry conditions; the expiration of license agreements and the cessation of related royalty income; the failure, inability or refusal of licensees to pay royalties; initiation, delays, setbacks or losses relating to the Company’s intellectual property or intellectual property litigations, or invalidation or limitation of key patents; the timing and results, which are not predictable and may vary in any individual proceeding, of any ICC ruling or award, including in the Amkor arbitration; fluctuations in operating results due to the timing of new license agreements and royalties, or due to legal costs; changes in patent laws, regulation or enforcement, or other factors that might affect the Company’s ability to protect or realize the value of its intellectual property; the risk of a decline in demand for semiconductor and camera module products; failure by the industry to use technologies covered by the Company’s patents; the expiration of the Company's patents; the Company's ability to successfully complete and integrate acquisitions of businesses, including the integration by DigitalOptics Corporation ("DOC") of its recently acquired camera module manufacturing facility in Zhuhai, China; the risk of loss of, or decreases in production orders from, customers of acquired businesses; financial and regulatory risks associated with the international nature of the Company’s businesses; failure of the Company’s products to achieve technological feasibility or profitability; failure to successfully commercialize the Company's products; changes in demand for the products of the Company’s customers; limited opportunities to license technologies and sell products due to high concentration in the markets for semiconductors and related products and camera modules; the impact of competing technologies on the demand for the Company’s technologies and products; failure by DOC to become a vertically integrated camera module supplier; and the reliance on a limited number of suppliers for the components used in the manufacture of DOC products. You are cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date of this release. The Company’s filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the year ended Dec. 31, 2011, and its Quarterly Report on Form 10-Q for the quarter ended June 30, 2012, include more information about factors that could affect the Company’s financial results. The Company assumes no obligation to update information contained in this press release. Although this release may remain available on the Company’s website or elsewhere, its continued availability does not indicate that the Company is reaffirming or confirming any of the information contained herein.