CompUSA 2010 Annual Report Download - page 31

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28
cars or automobile allowances and related reimbursements to certain NEO’ s and certain other Company managers
which are not provided to all employees. Certain Company executives also have or are entitled to receive severance
payments, and/or change of control payments pursuant to negotiated employment agreements they have with the
Company (see below). The Company does not provide to executive officers any (a) pension benefits or (b) deferred
compensation under any defined contribution or other plan on a basis that is not tax-qualified.
Tax Deductibility Considerations. It is our policy generally to qualify compensation paid to executive
officers for deductibility under section 162(m) of the Code. Section 162(m) generally prohibits deducting the
compensation of executive officers that exceeds $1,000,000 unless that compensation is based on the satisfaction of
objective performance goals. Our long term incentive plans (the 1995 Long-term Stock Incentive Plan, the 1999
Long-term Stock Incentive Plan, as amended, the 1995 Stock Option Plan for Non-Employee Directors, the 2006
Stock Incentive Plan for Non-Employee Directors, and the 2010 Long Term Incentive Plan) and the Systemax
Executive Incentive Plan are structured to permit awards under such plans to qualify as performance-based
compensation and to maximize the tax deductibility of such awards. However, we reserve the discretion to pay
compensation to our executive officers that may not be deductible.
Role of the Compensation Committee and CEO in Compensation Decisions
The Compensation Committee’ s responsibility is to review and approve corporate goals relevant to the
compensation of the Chief Executive Officer and, after an evaluation of the Chief Executive Officer’ s performance
in light of such goals, to set the compensation of the Chief Executive Officer. The Compensation Committee also
approves, upon the recommendation of the Chief Executive Officer (following consultation with the Chief Financial
Officer and Chief Executive of the Technology Products Group), (a) the annual compensation of the other executive
officers of the Company, (b) the annual compensation of certain subsidiary managers, and (c) all individual stock
incentive grants to other executive officers. The Compensation Committee is also responsible for reviewing and
making periodic recommendations to the Board with respect to the general compensation, benefits and perquisite
policies and practices of the Company, including the Company’ s stock-incentive based compensation plans. The
Compensation Committee has the authority to retain third party compensation consultants to provide assistance with
respect to compensation strategies, market practices, market research data and the Company’ s compensation goals.
2010 Long Term Incentive Plan
In 2010, the Board of Directors approved, and the stockholders of the Company approved at the 2010
Annual Meeting,, the 2010 Long Term Incentive Plan in order to promote the interests of the Company and its
stockholders by (i) attracting and retaining exceptional executive personnel and other key employees, including
consultants and advisors to the Company and its affiliates; (ii) motivating such employees, consultants and advisors
by means of performance-related incentives to achieve longer-range performance goals; and (iii) enabling such
employees, consultants and advisors to participate in the long-term growth and financial success of the Company.
The 2010 Long Term Incentive Plan provides for the granting of incentive stock options, non-qualified
stock options, stock appreciation rights, restricted stock, restricted stock units, performance awards (which may be
in the form of cash) or other stock-based awards. Any of the foregoing is referred to as an “Award.” Subject to
adjustment in the case of certain corporate changes, Awards may be granted under the 2010 Long Term Incentive
Plan with respect to an aggregate of 7,500,000 shares of the Company’ s Common Stock. During a calendar year,
Awards may be granted to any individual with respect to a maximum of 1,500,000 shares (or $10,000,000 in the
case of cash performance awards).
Any employee of the Company or of any affiliate and any individual providing consulting or advisory
services to the Company or an affiliate, is eligible to receive an award under the 2010 Long Term Incentive
Plan. The Compensation Committee administers the Plan and determines, in its sole discretion, the terms and
conditions of any Award. The Compensation Committee or the Board of Directors may delegate to one or more
officers or managers of the Company the authority to designate the individuals who will receive Awards under the
Plan provided that the Compensation Committee shall itself grant all Awards to those individuals who could
reasonably be considered to be subject to the insider trading provisions of Section 16 of the 1934 Act or whose
Awards could reasonably be expected to be subject to the deduction limitations of Section 162(m) of the Code.