CompUSA 2007 Annual Report Download - page 29

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24
KL2 2553275.3
Systemax Executive Incentive Plan
• The purpose of the Systemax Executive Incentive Plan is to promote the achievement of the
Company’s business objectives by providing cash bonus awards to those executive officers who
can significantly impact the Company’s performance towards those objectives. Further, the
Executive Incentive Plan enhances the Company’s ability to attract, develop and motivate
individuals as members of a talented management team. As described herein, the cash bonus
awards made under the Executive Incentive Plan may recognize Company, business unit, team
and/or individual performance. The number of Company executives who are eligible to
participate in the Executive Incentive Plan is currently seven.
• If the Executive Incentive Plan is approved, the Compensation Committee will administer the
plan, and may amend the plan. This committee is composed entirely of independent directors of
the Company, as defined under Section 162(m) of the Code.
• Cash bonus awards made under the Systemax Executive Incentive Plan will be subject to a
participant achieving one or more performance goals established by the Compensation Committee.
The performance goals may be based on the overall performance of the Company, and also may
recognize business unit, team and/or individual performance. No payment will be made under the
Executive Incentive Plan unless the Compensation Committee certifies that at least the minimum
objective performance measures have been met.
• Performance goals will be determined based primarily upon three general business areas:
1) Operational and Financial Performance (utilizing standard metrics such as net sales, operating
income, gross margin, earnings per share, working capital, stockholder equity and peer group
comparisons);
2) Strategic Accomplishments (including growth in the business and in the value of the
Company’s assets); and
3) Corporate Governance and Oversight (encompassing legal and regulatory compliance and
adherence to company policies including the timely filing of periodic reports with the SEC, the
Sarbanes-Oxley Act, employment and safety laws and regulations and the Company’s corporate
ethics policy).
In determining the compensation of a particular executive, consideration is given to the specific
corporate responsibilities that executive is charged with as they relate to the foregoing business
areas.
• The Compensation Committee would have the discretion to reduce the amount payable to, or to
determine that no amount will be paid to, a participant.
• The amount of any cash bonus award will vary based on the level of actual performance. The
amount of any award for a given year is determined for each participant by multiplying the
individual participant’s actual base salary in effect at the end of that year by a target percentage
(from 0% to 500%), related to the attainment of one or more performance goals, determined by the
Compensation Committee. The maximum amount payable under the Executive Incentive Plan to
any participant for any fiscal year of the Company is $5 million. In the event that an award
contains more than one performance goal, participants in the plan will be entitled to receive the
portion of the target percentage allocated to the performance goal achieved. In the event that the
Company does not achieve at least the minimum performance goals established, no award
payment will be made.