Best Buy 2009 Annual Report Download - page 40

improved opportunity for such employees to achieve award granted in August. Special long-term incentive
retirement income security. However, the plan is not awards may be granted at any time, as deemed
expected to provide sufficient income replacement necessary for new hires, promotions, recognition, or
relative to our named executive officers’ anticipated retention purposes. In April of each year, the
retirement needs. The potential retirement income gap Compensation Committee considers a stock option
for our U.S.-based named executive officers may be grant for directors. The Compensation Committee also
filled by other reward elements, including long-term considers stock option grants for new directors upon
incentives, or by the deferral of a portion of base salary their appointment to the Board. We do not coordinate
or short-term incentive awards under our Deferred or time the release of material information around our
Compensation Plan. Under the Retirement Savings Plan, grant dates in order to affect the value of the
we match employee contributions, including those made compensation. Our named executive officers do not
by our U.S.-based named executive officers, at rates play a role in the selection of grant dates.
approved by the Compensation Committee. For fiscal Determination of Grant Date. The grant date is the
2009, we matched 100% of the first 3% and 50% of date that the Compensation Committee approves the
the next 2% of eligible pre-tax earnings (up to IRS limits) equity award.
contributed by plan participants.
Determination of Exercise Price. The exercise price for
Although we currently intend to continue the Retirement
stock option awards is equal to the last reported sale
Savings Plan, as well as to make matching
price of our common stock, as quoted on the NYSE, on
contributions, the Compensation Committee may
the grant date. Under the terms of the Omnibus Plan,
terminate the plan or discontinue the matching
we may not grant stock options at a discount to fair
contributions at its sole discretion. If the Retirement
market value. Unless otherwise determined by the
Savings Plan were to be terminated, all company-
Compensation Committee, ‘‘fair market value’’ as of a
matching funds would immediately vest. JPMorgan
given date is the closing sale price of our common
Chase has served as the trustee for the Retirement
stock as quoted on the NYSE on such date or, if the
Savings Plan since April 1, 2004. We do not sponsor
shares were not traded on that date, the most recent
any other retirement plans in which our named executive
preceding date when the shares were traded.
officers participate.
Re-pricing of Stock Options. Under the terms of our
Deferred Compensation Plan. We sponsor an
Omnibus Plan, a stock option may not, without the
unfunded, unsecured Deferred Compensation Plan. We
approval of our shareholders, be: (i) amended to reduce
believe the plan provides a tax-deferred retirement
its initial exercise price, except in the case of a stock
savings vehicle that plays an important role in attracting
split or similar event; or (ii) canceled and replaced by a
and retaining executive talent. Additional information
stock option having a lower exercise price.
about our Deferred Compensation Plan is included in
Non-Qualified Deferred Compensation Plan on Stock Ownership Guidelines
page 48. The Compensation Committee has established stock
Equity Award Grant Practices ownership guidelines to promote the alignment of officer
and shareholder interests and to encourage behaviors
All equity-based incentive awards, including awards to
that have a positive influence on stock price
our named executive officers and directors, must be
appreciation and total shareholder return. The
approved by the Compensation Committee.
guidelines apply to all officers, including the named
Timing of Awards. Annual long-term incentive awards executive officers, and are part of an effort to
are granted in October of each year. This year there encourage employee stock ownership. Under the
was also a special, non-recurring long-term incentive guidelines, we expect our officers, including the named
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