Best Buy 2010 Annual Report Download - page 44

Compensation Committee may terminate the plan or grant for directors. The Compensation Committee also
discontinue the matching contributions at its sole considers stock option grants for new directors upon
discretion. If the Retirement Savings Plan were to be their appointment to the Board. We do not coordinate
terminated, all company-matching funds would or time the release of material information around our
immediately vest. JPMorgan Chase Bank has served as grant dates in order to affect the value of the
the trustee for the Retirement Savings Plan since April 1, compensation. Our named executive officers do not
2004. We do not sponsor any other retirement plans in play a role in the selection of grant dates.
which our named executive officers participate. Determination of Grant Date. The grant date is the
Severance Plan. We have adopted a severance plan date that the Compensation Committee approves the
for nearly all of our employees, including the named equity award.
executive officers. Although there are differences in Determination of Exercise Price. The exercise price for
benefits depending on the employee’s job level, the stock option awards is equal to the last reported sale
basic elements of the plan are comparable for all price of our common stock, as quoted on the NYSE, on
regular employees. The plan covers regular full-time the grant date. Under the terms of the Omnibus Plan,
and part-time U.S. employees of Best Buy Co., Inc., we may not grant stock options at a discount to fair
Best Buy Stores, L.P., Best Buy International Holdings, market value. Unless otherwise determined by the
Inc. and Best Buy Enterprise Services, Inc., and their Compensation Committee, ‘‘fair market value’’ as of a
domestic subsidiaries, who have at least six months of given date is the closing price of our common stock as
continuous service, except for those with a separate quoted on the NYSE on such date or, if the shares were
agreement. The plan covers involuntary terminations due not traded on that date, the most recent preceding date
to job elimination and discontinuation, office closing, when the shares were traded.
reduction in force, business restructuring or other
Re-pricing of Stock Options. Under the terms of our
circumstances as we determine. Eligible terminated
Omnibus Plan, a stock option may not, without the
employees would receive a severance payment ranging
approval of our shareholders, be: (i) amended to reduce
from two weeks to 96 weeks base salary. Basic
its initial exercise price, except in the case of a stock
employee benefits such as medical, dental and life
split or similar event; or (ii) canceled and replaced by a
insurance would be continued for six months to up to
stock option having a lower exercise price.
18 months. The named executive officers are eligible for
96 weeks of base salary and 18 months of benefit Executive Stock Ownership Guidelines. The
continuation. Compensation Committee has established stock
ownership guidelines to promote the alignment of officer
Equity Award Grant Practices. All equity-based
and shareholder interests and to encourage behaviors
incentive awards, including awards to our named
that have a positive influence on stock price
executive officers and directors, must be approved by
appreciation and total shareholder return. The
the Compensation Committee.
guidelines apply to all officers, including the named
Timing of Awards. Beginning in June 2009, we executive officers, and are part of an effort to
changed the frequency and timing of our long-term encourage employee stock ownership. Under the
incentive awards for eligible employees from single guidelines, we expect our officers, including the named
annual grants to three grants in fiscal 2010 and executive officers, to acquire ownership of a fixed
quarterly grants starting in fiscal 2011. Special number of shares, based on their position, within five
long-term incentive awards may be granted at any time, fiscal years of assuming their current position. The stock
as deemed necessary for new hires, promotions, ownership expectation generally remains effective for as
recognition or retention purposes. In April of each year, long as the officer holds the position. The guidelines
the Compensation Committee considers a stock option
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