Ingram Micro 2007 Annual Report Download - page 77

Section 162(m) of the Code (“Qualified Stock-Based Compensation”). If the Committee, in its sole discretion,
decides to grant such an Award to a Covered Employee that is intended to constitute Qualified Performance-Based
Compensation, then the provisions of this Section 9(c) shall control over any contrary provision contained in the
Plan. The Committee may in its sole discretion grant Awards to other Eligible Individuals that are based on
performance criteria but that do not satisfy the requirements of this Section 9(c) and that are not intended to
constitute Qualified Performance-Based Compensation. Unless otherwise specified by the Committee at the time of
grant, the performance criteria, the objectively determinable adjustments and the achievement of each performance
goal with respect to an Award intended to constitute Qualified Performance-Based Compensation shall be
determined on the basis of United States generally accepted accounting principles (“GAAP”).
(i) Performance Goals with Respect to Qualified Performance-Based Compensation. Any perfor-
mance goals established by the Committee for any Award which is intended to constitute Qualified
Performance-Based Compensation shall satisfy the following requirements:
(A) Such goals shall be based on any one or more of the following performance criteria: asset turn-
over, customer satisfaction, market penetration, associate satisfaction or similar indices, price of Ingram
Micro’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.
(B) The Committee may, in its sole discretion, provide that one or more of the following objectively
determinable adjustments shall 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 Ingram Micro 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; or 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 Ingram Micro’s core, on-going business activities; or items relating to any other unusual or nonre-
curring events or changes in applicable laws, accounting principles or business conditions. Such
determinations shall be made within the time prescribed by, and otherwise in compliance with,
Section 162(m) of the Code.
(C) Such goals may be established on a cumulative basis or in the alternative, and may be
established on a stand-alone basis with respect to Ingram Micro, any of its operating units, or an
individual, or on a relative basis with respect to any peer companies or index selected by the Committee.
(D) Such goals may be based on an analysis of historical performance and growth expectations for
the business, financial results of other comparable businesses, and progress towards achieving the long-
range strategic plan for the business.
(E) Such goals shall be established in such a manner that a third party having knowledge of the
relevant facts could determine whether the goals have been met.
A-7