Ingram Micro 2007 Annual Report Download - page 56

appreciation right granted under the Amended 2003 Plan or any prior plan, and each such share will be added back
as 1.9 shares if such share was subject to an award other than an option or stock appreciation right granted under the
Amended 2003 Plan or any prior plan.
What are the eligibility and participation criteria?
Eligibility to participate in the Amended 2003 Plan is limited to our employees, including any officer or
employee-director of the Company or any of our affiliates, and any member of our Board of Directors. Currently,
approximately 15,000 of our employees and employees of our subsidiaries and all members of our Board of Directors
are eligible to participate in the Amended 2003 Plan. We anticipate that less than 5% of those eligible will participate
in the Amended 2003 Plan. Participation in the Amended 2003 Plan is at the discretion of the Committee.
What are the types of awards that may be made under the Amended 2003 Plan?
The Amended 2003 Plan permits the granting of the following types of awards: (1) stock options that qualify as
incentive stock options under the Code, (2) options other than incentive stock options, which will be referred to as
non-qualified stock options, (3) stock appreciation rights, or SARs, granted either alone or in tandem with other
awards under the Amended 2003 Plan, (4) restricted stock awards and restricted stock units, (5) performance
awards, and (6) other stock-based awards.
What special requirements must Section 162(m) “qualified performance-based compensation” awards
under the Amended 2003 Plan satisfy?
The Committee may grant performance awards that are intended to constitute “qualified performance-based
compensation” within the meaning of Section 162(m) of the Code in order to preserve the deductibility of these
awards for federal income tax purposes. Any performance goal established by the Committee for any award which
is intended to constitute “qualified performance-based compensation” within the meaning of Section 162(m) of the
Code must satisfy the following requirements:
(i) Such goals must be based on any one or more of the following: asset turn-over, customer satisfaction,
market penetration, associate satisfaction or similar indices, price of the Company’s Class A common stock,
stockholder return, return on assets, return on equity, return on investment, return on capital, return on invested
capital, return on working capital, return on sales, other return measures, sales productivity, sales growth, total
new sales, productivity ratios, expense targets, economic profit, economic value added, net earnings (either
before or after one or more of the following: interest, taxes, depreciation and amortization), income (either
before or after taxes), operating earnings or profit, gross or net profit or operating margin, gross margin, gross
or net sales or revenue, cash flow (including, but not limited to, operating cash flow and free cash flow), net
worth, earnings per share, earnings per share growth, operating unit contribution, achievement of annual or
multiple year operating profit plans, earnings from continuing operations, costs, expenses, working capital,
implementation or completion of critical projects or processes, performance achievements on certain
designated projects, debt levels, market share or similar financial performance measures as may be determined
by the Committee, any of which may be measured either in absolute terms or as compared to any incremental
increase or decrease or as compared to results of a peer group or to market performance indicators or indices.
(ii) The Committee may, in its sole discretion, provide that one or more of the following objectively
determinable adjustments will be made to one or more of such goals: items related to a change in accounting
principle; items relating to financing activities; expenses for restructuring or productivity initiatives; other
non-operating items; items related to acquisitions; items attributable to the business operations of any entity
acquired by the Company during the performance period; items related to the disposal of a business or segment
of a business; items related to discontinued operations; items attributable to any stock dividend, stock split,
combination or exchange of shares occurring during the performance period; any other items of significant
income or expense which are determined to be appropriate adjustments; items relating to unusual or
extraordinary corporate transactions, events or developments; items related to amortization of acquired
intangible assets; items that are outside the scope of the Company’s core, on-going business activities; or items
relating to any other unusual or nonrecurring events or changes in applicable laws, accounting principles or
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