Kodak 2007 Annual Report Download - page 172

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factor influencing program design is the support of business objectives. Generally, whether or not compensation will be deductible under
Section 162(m) of the Code will be an important, but not be the decisive factor, with respect to the Committee’s compensation
determinations.
Policy on Recoupment of Bonuses in the Event of Certain Financial Restatements
In 2006, the Board adopted a policy that permits the Board to seek to recover, to the extent permitted under applicable local law, any
performance-based bonus awarded to a Named Executive Officer under EXCEL if an executive’s fraud or misconduct caused or partially
caused the need for significant financial restatement and if the bonuses would have been lower as a result of the restatement. The policy is
more fully discussed on page 22 of this Proxy Statement.
OTHER COMPENSATION ELEMENTS
Retirement Plans
The Company offers a tax-qualified defined benefit plan comprised of a cash balance component and a traditional defined benefit
component (KRIP) and tax-qualified 401(k) defined contribution plan (SIP), which cover virtually all U.S. employees. In addition to these
tax-qualified retirement plans, the Company provides supplemental non-qualified retirement benefits to our Named Executive Officers
under the Kodak Unfunded Retirement Income Plan (KURIP) and the Kodak Excess Retirement Income Plan (KERIP). KURIP and KERIP
are unfunded retirement plans that are designed to provide our executives with pension benefits that make up for the Code’s limitations on
allocations and benefits that may be paid under KRIP. None of our Named Executive Officers has an accumulated benefit under KERIP.
The details of KRIP and KURIP are described under the Pension Benefits Table on page 63 of this Proxy Statement.
The Company believes that our tax-qualified retirement plans and non-qualified supplemental retirement plans enhance our executive
compensation package. The primary objective of our retirement plans is to attract and retain our employees.
Supplemental Individual Retirement Arrangements
We have also entered into individual letter agreements with our Named Executive Officers, except Ms. Hellyar, to provide additional
retirement benefits beyond those available under our tax-qualified retirement plans and non-qualified supplemental retirement plans. For
some of our Named Executive Officers, these agreements provide for additional years of service in calculating their benefits under KRIP
and KURIP.
Supplemental individual retirement arrangements were necessary to attract and retain certain Named Executive Officers who would accrue
less than competitive benefits under the Kodak retirement plans due to their short service with the Company. The benefits provided to our
Named Executive Officers under any individual retirement arrangement are described following the Pension Benefits Table on page 63 of
this Proxy Statement.
Deferred Compensation Plan
The Company maintains a non-qualified deferred compensation plan for its executives, known as the Eastman Kodak Company 1982
Executive Deferred Compensation Plan (EDCP). The plan permits the Company’s executives to defer a portion of their base salary and
annual bonus awards. Each fall, the Company’s executives may elect to defer base salary for the following year and up to a portion of any
bonus earned under EXCEL the following year. The plan is intended to promote retention by providing our executives with a long-term
savings opportunity on a tax-deferred basis. The details of this plan are described under the Non-Qualified Deferred Compensation Table
on page 66 of this Proxy Statement. In 2007, the Committee froze the receipt of new monies into this plan in 2008 due to its low utilization
and its administrative cost.
Perquisites
The primary perquisites that all our Named Executive Officers receive are financial counseling services, home security services, personal
umbrella liability insurance coverage, occasional use of the Company’s driver service and executive physicals. The executive physical
perquisite is not available beyond 2007 due to its low utilization and high cost.
Our executive security program requires our CEO to use Company aircraft for all air travel, whether personal or business. Our Named
Executive Officers, other than our CEO, also on occasion, with CEO approval, use corporate aircraft with their spouses for personal travel.
The Company provides most of these perquisites primarily for security related reasons, to maximize an executive’s time spent on Kodak
business or to attract and retain our Named Executive Officers. The compensation attributed to our Named Executive Officers for 2007 and
required to be reported for these perquisites is included in the Summary Compensation Table on page 51 of this Proxy Statement.