UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(D) OF

THE SECURITIES EXCHANGE ACT OF 1934

BSQUARE CORPORATION

WASHINGTON (State or Other Jurisdiction of Incorporation)		000-27687 (Commission File Number)		91-1650880 (IRS Employer Identification No.)

110 110^th Ave NE, Suite 200

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2 below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

BSQUARE CORPORATION

FORM 8-K

Item 5.02.		Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

     (e)

     BSQUARE Corporation 2008 Executive Compensation Plan

     On March 18, 2008, the Compensation Committee of the Board of Directors (the “Committee”) of BSQUARE Corporation (the “Company”) approved the 2008 Executive Compensation Plan (the “Plan”), which is applicable to the Chief Executive Officer, Chief Financial Officer and Vice Presidents of the Company. The Plan is substantially similar to the information regarding executive officer compensation that was provided in the Company’s proxy statement for its 2007 annual meeting. The material changes to executive compensation reflected in the Plan are described below and a complete copy of the Plan is attached hereto as Exhibit 99.1.

     Target Bonus Opportunity

     For fiscal year 2008, the Committee has modified the following target bonus opportunities, which are set forth as a percentage of 2007 or 2008 base salary, respectively:

		2007 Target Bonus		2008 Target Bonus
Executive Title		Opportunity		Opportunity
Chief Executive Officer		55%		60%
Chief Financial Officer		40%		45%
Vice Presidents		30%		35%

     Company Achievement Multiplier

     For fiscal year 2008, the Committee has increased the adjusted net income that the Company must achieve for the fiscal year for executives to be eligible for any bonus from $2 million in 2007 to $4 million in 2008. Once that level of adjusted net income is achieved, the level of eligibility is as follows:

		Achievement %
		as % of Bonus
Adjusted Net Income (1)		Potential (2)
Less than $4 million			0%
$4 million to $6.2 million			50-100%
$6.2 million to $9.3 million			100-150%
Greater than $9.3 million			150%

     Payment of Bonuses

     If an executive becomes eligible for a bonus under the Plan, the form and mix of consideration is dependent on the amount of bonus earned. In 2007, each executive receiving a bonus was to be paid an amount in cash equal to up to 25% of that executive’s annual salary, with the remainder, if any, to be paid in the form of restricted stock vesting in annual increments over two years. In 2008, each executive receiving a bonus will be paid an amount in cash equal to up to 30% of an executive’s annual salary, with the remainder, if any, to be paid in the form of restricted stock units which vest in four equal parts at the end of July and end of December for two years.

     Sales Executive Compensation

     The Company’s Vice President of Sales, Larry C. Stapleton, does not participate in the bonus related portions of the Plan. Instead, the Committee has established a separate “On Target Earnings” (OTE) compensation program comprised of base salary, commissions and periodic bonuses for achieving certain strategic or tactical objectives that the Committee and chief executive officer determine on annual basis. The fiscal year 2008 OTE for Mr. Stapleton was set by the Committee at $291,000, assuming the Company achieves the revenue and selected gross profit targets set by the Committee and chief executive officer.

     Fiscal 2008 Executive Compensation

     On March 18, 2008, in addition to the Plan modifications described above, the Committee approved executive compensation arrangements for fiscal 2008 for the chief executive officer and other executive officers of the Company as part of its annual review process.

     The Committee approved base salary, effective as of March 17, 2008, and annual equity awards for certain officers as follows:

		Base				Stock Options
Name/Title of Executive		Compensation				Awarded (1)
Brian T. Crowley, President and Chief Executive Officer		$	270,000				45,000
Scott C. Mahan, Vice President, Finance, Chief Financial Officer, Secretary and Treasurer		$	208,000				25,000
Larry C. Stapleton, Vice President, North American Sales		$	156,000				25,000
Carey E. Butler, Vice President, Professional Engineering Services		$	190,000				25,000
Rajesh Khera, Vice President, Products		$	160,000				—

Item 9.01. Financial Statement and Exhibits

(d) Exhibits.

The following exhibit is furnished with this report:

Exhibit Number		Exhibit Description
99.1		BSQUARE Corporation 2008 Executive Compensation Plan

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

EXHIBIT INDEX

Exhibit Number		Exhibit Description
99.1		BSQUARE Corporation 2008 Executive Compensation Plan