Kodak 2008 Annual Report Download - page 183

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Metric Definition
Total Segment Earnings from Operations
(EFO)
Total earnings of all the Company’s segments included within earnings from
continuing operations before:
•Restructuring/rationalization
•Interest
•Other income and charges
•Income tax
Excluding:
•EFO impact of acquisitions and new strategic alliances having an annualized
revenue of greater than $100 million, along with associated deal and
integrations costs.
For the 2008 Leadership Stock performance cycle, the payment of any stock units earned under the program for the 2008 performance
cycle is delayed for two years contingent on the executive’s continued employment with the Company. During this two-year vesting period,
dividend equivalents accrue on the stock units, but payment of the dividends is also subject to this two-year vesting period. At the end of
the two-year period, the stock units and the dividend equivalents earned on these stock units are paid to the executive in the form of
shares of Company common stock. All shares earned under the Leadership Stock program are granted under the Company’s 2005
Omnibus Long-Term Compensation Plan. Due to Company results, there were no shares of common stock earned under the 2008
Leadership Stock performance cycle.
2008 Option Grants
On December 9, 2008, the Compensation Committee approved a non-qualified stock option grant for each Named Executive Officer. Stock
options granted in 2008 have a seven-year term and vest in three substantially equal annual installments beginning on the first anniversary
of the grant date. Upon termination of employment, all unvested stock options will be forfeited, except in certain cases. If a Named
Executive Officer’s employment is terminated as a result of death, disability, transfer or divestiture (as defined in the plan), all unvested
stock options will fully vest and will expire on the third anniversary date of the Named Executive Officer’s termination of employment. If a
Named Executive Officer’s employment is terminated as a result of retirement, layoff, pursuant to a special separation program or for an
approved reason, any unvested stock options will continue to vest and will expire three years after termination of employment. The
exercise price of the stock options granted to the Named Executive Officers on December 9, 2008 is $7.41, the mean between the high
and low price at which the Kodak shares traded on the NYSE on the grant date. All options are granted under the Company’s 2005
Omnibus Long-Term Compensation Plan.