Electronic Arts 2016 Annual Report Download - page 73
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Nonassignability Rights under the Executive Bonus Plan are not assignable or transferable.
Amendment/
Termination
The Compensation Committee generally may amend, modify, suspend or terminate
the Executive Bonus Plan, in whole or in part, at any time and in any respect,
provided, however no such amendment, modification, suspension or termination
result in an increase in the amount of compensation payable pursuant to any award
under the Executive Bonus Plan or cause compensation that is, or may become,
payable under the Executive Bonus Plan to fail to qualify as deductible
“performance-based compensation” within the meaning of Section 162(m) of the
Code.
Compliance with Section 409A of the Code
To the extent applicable, it is intended that the Bonuses granted under the Executive Bonus Plan will comply
with or be exempt from the provisions of Section 409A of the Code, such that the income inclusion provisions of
Section 409A(a)(1) of the Code do not apply to the Participants. The Bonuses will be administered and
interpreted in a manner consistent with this intent.
Certain U.S. Federal Income Tax Consequences
The following summarizes only the U.S. federal income tax consequences of participation in the Executive
Bonus Plan based upon federal income tax laws in effect on the date of this Proxy Statement. An Executive
Bonus Plan Participant will be taxed at ordinary income rates on the cash Bonus in the year in which such cash is
received. Generally, and subject to the provisions of Section 162(m) of the Code, the Company will receive a
federal income tax deduction corresponding to the amount of income recognized by the 162(m) Bonus Plan
Participants.
ERISA
The Executive Bonus Plan is not subject to any of the provisions of the Employee Retirement Income Security
Act of 1974 and is not qualified under Section 401(a) of the Code.
Proposed Amendments to the Executive Bonus Plan
At the Annual Meeting, stockholders will be asked to approve amendments to increase the bonus target cap to 200%
of a Participant’s base salary and to increase the Bonus payment cap to 300% of a participant’s Bonus Target with
no changes to the $5,000,000 maximum Bonus amount that can be paid under the Executive Bonus Plan.
B-3
Proxy Statement