XM Radio 2008 Annual Report Download - page 157

or a combination of cash and shares. No SAR may be exercisable more than 10 years from the date of grant.
At the discretion of the Committee, SARs may, but need not be, intended to qualify as performance-based
compensation.
Restricted Stock and Restricted Stock Units. Restricted stock and RSUs granted under the Plan will be
subject to such terms and conditions, including the duration of the period during which, and the conditions, if
any, under which, the restricted stock and restricted stock units may be forfeited to us, as may be determined
by the Committee in its sole discretion. Each RSU will have a value equal to the fair market value of a share
of our common stock. RSUs will be paid in cash, shares, other securities or other property, as determined by
the Committee in its sole discretion, upon the lapse of the restrictions applicable thereto, or otherwise in
accordance with the applicable award agreement.
Performance Awards. Performance awards granted under the Plan will consist of a right which is
(i) denominated in cash or shares, (ii) valued, as determined by the Committee, in accordance with the
achievement of such performance goals during such performance periods as the Committee will establish, and
(iii) payable at such time and in such form as the Committee will determine. Subject to the terms of the Plan
and any applicable award agreement, the Committee will determine the performance goals to be achieved
during any performance period, the length of any performance period, the amount of any performance award
and the amount and kind of any payment or transfer to be made pursuant to any performance award.
Performance awards may be paid in a lump sum or in installments following the close of the performance
period (as set forth in the applicable award agreement) or, in accordance with procedures established by the
Committee, on a deferred basis.
Other Stock-Based Awards. In addition to the foregoing types of awards, the Committee will have
authority to grant to participants an “other stock-based award” (as defined in the Plan), which will consist of
any right which is (i) not a stock option, SAR, restricted stock or RSU or performance award and (ii) an award
of shares or an award denominated or payable in, valued in whole or in part by reference to, or otherwise
based on or related to, shares of our common stock (including, without limitation, securities convertible into
shares of our common stock), as deemed by the Committee to be consistent with the purposes of the Plan;
provided that any such rights must comply, to the extent deemed desirable by the Committee, with Rule 16b-3
and applicable law. Subject to the terms of the Plan and any applicable award agreement, the Committee will
determine the terms and conditions of any such other stock-based award, including the price, if any, at which
securities may be purchased pursuant to any other stock-based award granted under the Plan.
Dividend Equivalents. In the sole discretion of the Committee, an award (other than options or SARs),
whether made as another stock-based award or as any other type of award issuable under the Plan, may
provide the participant with the right to receive dividends or dividend equivalents, payable in cash, shares,
other securities or other property and on a current or deferred basis.
Performance Criteria
The Plan requires that the Committee establish “Performance Criteria” for purposes of any award under
the Plan that is intended to qualify as “performance-based compensation” under Section 162(m) of the Code.
The Performance Criteria that will be used to establish the performance goal(s) will be based on the attainment
by us of specific levels of performance (or by one or more of our affiliates, divisions or operational units) and
will be limited to the following: return on net assets, return on stockholders’ equity, return on assets, return on
capital, revenue, average revenue per subscriber, stockholder returns, profit margin, earnings per Share, net
earnings, operating earnings, free cash flow, earnings before interest, taxes, depreciation and amortization,
number of subscribers, growth of subscribers, operating expenses, capital expenses, subscriber acquisition
costs, share price, enterprise value, equity market capitalization or sales or market share. To the extent required
under Section 162(m) of the Code, the Committee will, within the first 90 days of a performance period (or, if
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