CompUSA 2010 Annual Report Download - page 28

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25
EXECUTIVE COMPENSATION
Compensation Discussion and Analysis
In this section, we discuss the material elements of our compensation programs and policies, including the
objectives of our compensation programs and the reasons why we pay each element of our executives’
compensation. Following this discussion, you will find a series of tables containing more specific details about the
compensation earned by, or awarded to, the following individuals, whom we refer to as the Named Executive
Officers or NEOs. This discussion focuses on compensation practices relating to the NEO’s for our 2010 fiscal
year.
Our NEO’ s in 2010 (based on total 2010 compensation earned) were as follows:
Richard Leeds
Chairman; Chief Executive Officer
Bruce Leeds
Vice Chairman
Robert Leeds
Vice Chairman
Gilbert Fiorentino3
Chief Executive - Technology Products Group
Lawrence Reinhold
Executive Vice President; Chief Financial Officer
Central Objectives and Philosophy of Our Executive Compensation Programs
The Company’ s executive compensation programs are designed to achieve a number of important
objectives, including attracting and retaining individuals of superior ability and managerial talent, rewarding
individual contributions to the achievement of the Company’ s short and long-term financial and business objectives,
promoting integrity and good corporate governance, and motivating our executive officers to manage the Company
in a manner that will enhance its growth and financial performance for the benefit of our stockholders, customers
and employees. Accordingly, in determining the amount and mix of compensation, the Compensation Committee
seeks both to provide a competitive compensation package and to structure annual and long-term incentive programs
that reward achievement of performance goals that directly correlate to the enhancement of sustained, long-term
stockholder value, as well as to promote executive retention.
Our Compensation Committee seeks to design compensation programs with features that mitigate risk
without diminishing the incentive nature of the compensation. The Company’ s variable pay programs are designed
to reward outstanding individual and team performance while mitigating risk taking behavior that might affect
financial results. We believe our programs encourage and reward prudent business judgment and appropriate risk-
taking over the long term. We believe the following factors are effective in mitigating risk relating to our
compensation programs:
• Multiple Performance factors: We use multiple performance factors that encourage executives to
focus on the overall health of the business rather than a single financial measure.
• Award Cap. Our 2010 NEO Cash Bonus Plan and our 2011 NEO Cash Bonus Plan (both
discussed below) cap the maximum award payable to any individual.
• Clawback Provision. The Company’ s 2010 NEO Cash Bonus Plan and 2011 NEO Cash Bonus
Plan provide the Company the ability to recapture all or a portion of cash awards (i) from our
executive officers to the extent a bonus resulted from reported financial results that upon
restatement of such results (other than as a result of changes in accounting principles) would not
have generated the bonus or would have generated a lower bonus or (ii)from an executive officer
if the Board learns of any misconduct by the executive officer that contributed to the Company
having to restate all or a portion of its financial statements. In addition, the Board may recapture
3 Mr. Fiorentino is on administrative leave from his position with the Company. See “Employment Arrangements of the Named
Executive Officers- Gilbert Fiorentino” at page 33 and “Potential Payments Upon Termination or Change of Control- Gilbert
Fiorentino” at page 40 for additional information.