CompUSA 2009 Annual Report Download - page 26

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general oversight and approval of corporate matters and receives information relating to material risks affecting the Company
from management and from our Legal, Risk Management/Insurance and Internal Audit departments.
• Long Term Equity Compensation. A number of factors mitigate risks inherent in long-term equity compensation, specifically
the vesting period for stock options and restricted stock unit grants, which we believe causes our executives to focus on long
term achievements and on building stockholder value.
We believe that our compensation policies for employees generally throughout our organization are not reasonably likely to have a
material adverse effect on our company. From time to time a limited number of key managers are eligible to receive stock options
and/or restricted stock units in varying amounts based on the judgment of the Compensation Committee. However, all awards are
subject to years long vesting periods.
Elements of Our Executive Compensation Programs
To promote the objectives described above, our executive compensation programs consist of the following principal elements:
•
Base salary;
•
Incentive cash compensation, i.e. bonuses;
•
Stock–based incentives and
•
Benefits, perquisites and other compensation.
The Committee does not maintain formal policies for specifically allocating compensation among current and long-term
compensation or among cash and non-cash compensation elements. Instead, the Committee maintains flexibility and adjusts different
elements of compensation based upon its evaluation of the Company’ s key compensation goals set forth above. The Company does not
have a formal policy regarding internal pay equity.
Base Salary - Salary levels are subjectively determined based on individual and Company performance as well as an objective
assessment of prevailing salary levels for comparable companies, derived from widely available published reports of the average of
prevailing salary levels for comparable companies (based on industry, revenues, number of employees, location and similar factors) in
the Company’ s geographic region. Such reports do not identify the component companies. Each of Mr. Reinhold’ s and Mr.
Fiorentino’ s minimum salary is set pursuant to his respective employment agreement.
Cash Bonuses - Incentive cash compensation of the Company’ s NEO’ s under the Systemax Executive Incentive Plan described
below is based primarily upon an evaluation of Company performance as it relates to three general business areas:
•
Operational and Financial Performance (utilizing standard metrics such as net sales, operating income, consolidated
net income, earnings before interest and taxes (“EBIT”), gross margin, operating margin, earnings per share, working
capital, return on invested capital, stockholder equity and peer group comparisons);
•
Strategic Accomplishments (including growth in the business, implementation of systems, process and technology
improvements, and growth in the value of the Company’ s asset
s, including through strategic acquisition
transactions); and
•
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, environmental,
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 such
executive is charged with as they relate to the foregoing business areas.