Kodak 2010 Annual Report Download - page 147

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Human Resources Officer is authorized to amend any executive compensation or equity-based compensation plan in which our Named
Executive Officers participate other than to materially increase the benefits accruing to a participant under the plan, increase the number of
shares available for issuance under the plan or substantially modify the requirements as to eligibility for participation. The Chief Human
Resources Officer has also been delegated the authority to amend award agreements under any executive compensation and equity-
based compensation plan other than to increase the benefits accruing to the participant and to determine the manner and timing of
payments under the Eastman Kodak Company 1982 Executive Deferred Compensation Plan (EDCP).
The Compensation Committee meets routinely throughout the year. It is the Compensation Committee’s policy to make most
compensation decisions in a two-step process to ensure sufficient deliberation. The Compensation Committee approves all compensation
and awards under the Company’s executive compensation plans for each of the Company’s Section 16 Officers. The Compensation
Committee also approves compensation levels for each component of total direct compensation following discussions and after review of
analyses and recommendations received from its independent compensation consultant and management as it deems appropriate. The
CEO makes recommendations regarding each compensation element for the Named Executive Officers other than the CEO. The
Compensation Committee’s independent compensation consultant and the Director of Global Compensation present analyses regarding
the compensation of the CEO. Based on these analyses the Committee Chair makes recommendations regarding CEO compensation to
the Compensation Committee in executive sessions.
With respect to the Company’s executive performance-based plans, management, including the CEO, CFO, Chief Human Resources
Officer, Chief Compliance Officer and Director of Global Compensation, proposes performance goals. Management develops these
performance targets considering the Company’s strategic and operational imperatives for the year and its executive compensation strategy
and goals. The performance targets and individual allocation targets for the Company’s annual variable pay plan are reviewed and
approved by the Compensation Committee within the first 90 days of each calendar year. The CEO and Chief Human Resources Officer
are involved in formulating recommendations to the Compensation Committee on target allocation levels for each Named Executive Officer
for the upcoming performance year, with the exception of target allocation levels for the CEO. The performance targets of the Company’s
long-term equity incentive compensation plans for the new performance cycle are also reviewed and approved by the Compensation
Committee within the first 90 days of each calendar year. Throughout the year, the Compensation Committee reviews projections for
achievement against each plan’s performance targets.
Role of Compensation Consultant
To advise the Compensation Committee on the Company’s executive compensation plans, practices and awards, the Committee engaged
an independent compensation consultant, Frederic W. Cook & Co., Inc. The Compensation Committee’s consultant attends Committee
meetings on a regular basis and provides the Committee with market information and analysis of the Company’s executive compensation
practices to insure consistency with the Company’s executive compensation strategy and goals. The consultant also provides insight on
best practices in executive compensation.
The Company’s Chief Human Resources Officer and others directly involved with the Company’s executive compensation programs
routinely consult with and seek advice from the consultant regarding the design, competitiveness, operation and administration of our
executive compensation programs and practices that fall within the scope of the Compensation Committee charter. In 2010, neither the
Compensation Committee nor the Company engaged other consultants or advisors to advise in determining the amount or form of
executive compensation. The consultant does not provide any services other than executive compensation consulting to the Committee
and Company management.
The Committee discussed principles of engagement between management and the consultant and approved the policy under which our
independent consultant is to perform services. This policy reinforces that the consultant reports directly to the Committee and provides
services only in the area of Executive Compensation. In addition, the policy defines advice and analysis to be provided directly to the
Committee and a limited set of work within the Committee’s areas of responsibility for which management may engage the consultant
without the Committee’s prior approval. The policy specifies that work outside the defined scope must be pre-approved by the Committee
chair. At the end of 2010, the consultant provided to the Committee a written affirmation of its compliance with this policy.
Finance Committee — 5 meetings in 2010
The Finance Committee assists the Board in overseeing the Company’s: balance sheet and cash flow performance; financing plans and
transactions; capital expenditures; acquisitions, joint ventures and divestitures; risk management programs; performance of sponsored
pension plans; and tax policy. A detailed list of the Finance Committee’s functions is included in its charter, which can be accessed at
www.kodak.com/go/committees.
In the past year, the Finance Committee:
• Reviewed the Company’s capital structure and financing strategies, including its capital expenditures, debt repayment plan and
hedging of foreign exchange and commodity price risks;
• Reviewed cash flow and balance sheet performance;
• Reviewed credit ratings and key financial ratios;