CompUSA 2007 Annual Report Download - page 32

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KL2 2553275.3
individual to the success of the Company). Options and all rights thereunder are non-transferable and non-
assignable by the holder, except to the extent that the estate of a deceased holder of an option may be permitted to
exercise such option or as otherwise allowed by the Compensation Committee in certain instances.
Exercise of Options
Options shall be exercisable at such rate and times as are fixed by the Compensation Committee for each
option. Notwithstanding the foregoing, all or any part of any remaining unexercised options granted to any person
under the Plan may be exercised (a) immediately upon (but prior to the expiration of the term of the option) the
holder’s retirement from the Company on or after his or her 65th birthday, (b) subject to the provisions of the Plan
concerning termination of employment, upon the disability (to the extent and in a manner as shall be determined by
the Compensation Committee in its sole discretion) or death of the holder, (c) upon the occurrence of such special
circumstances or event as in the opinion of the Compensation Committee merits special consideration or (d) with a
few exceptions, if while the holder is employed by, or serving as a director of or consultant to, the Company there
occurs the acquisition by a person or entity, or a group of persons or entities acting in conjunction, of 20% or more
of the issued and outstanding Shares having ordinary voting power, or a sale, lease, transfer or other disposition of
all or substantially all of the assets of the Company, or a merger or consolidation of the Company into or with any
other company which results in the acquisition of the Company by a non-affiliated entity, or any other event which
would similarly constitute an acquisition of the Company by a non-affiliated entity.
Payment for and Issuance of Shares
Payment for the Shares purchased pursuant to the exercise of an option shall be made in full at the time of
the exercise by the use of one of the following methods: (a) paid in cash or its equivalent; (b) if and to the extent
permitted by the Compensation Committee, by exchanging Shares owned by the optionee (which are not the subject
of any pledge or other security interest); or (c) by a combination of (a) and (b), provided that the combined value of
all cash and cash equivalents and the fair market value of any such Shares so tendered to the Company as of the date
of such tender is at least equal to such option exercise price. The Plan contains standard provisions to assure that
any exercise of an option or the issuance of Shares will comply with applicable securities and income tax
withholding laws.
In the event that any participant delivers Shares in payment of the exercise price of any option, the
Compensation Committee shall have the authority to grant or provide for the automatic grant of a restoration option
to such participant. The grant of a restoration option shall be subject to the satisfaction of such conditions or criteria
as the Compensation Committee in its sole discretion shall establish from time to time. A restoration option shall
entitle the holder thereof to purchase a number of Shares equal to the number of such Shares so delivered upon
exercise of the original option. A restoration option shall have a per Share exercise price of not less than 100% of
the per Share market value on the date of grant of such restoration option, a term no longer than the remaining term
of the original option at the time of exercise thereof, and such other terms and conditions as the Compensation
Committee in its sole discretion shall determine.
Amendment and Termination of the Plan
The Board may at any time amend, suspend or discontinue the Plan except that no amendment to the Plan
can increase the number of Shares for which options may be granted under the Plan or to any individual in any
calendar year (except pursuant to the adjustment provisions described above) or change the class of persons to
whom options may be granted without stockholder approval, or permit the granting of options after December 31,
2010 (except with respect to restoration options with regard to options that themselves survive beyond 2010). In
addition, no amendment can alter the terms and conditions of any option granted prior to the amendment, unless the
holder consents to such amendment.
Section 162(m) of the Code
Under Section 162(m) of the Code, publicly-held companies generally may not deduct compensation that
exceeds $1 million to any proxy-named executive officer with respect to the taxable year. Compensation which is