Symantec 2008 Annual Report Download - page 66

While structuring compensation programs that result in more favorable tax and financial reporting treatment is a general
principle, the Committee balances these goals with other business needs that may be inconsistent with obtaining the most
favorable tax and accounting treatment for each component of its compensation.
Deductibility by Symantec. Under Section 162(m) of the Internal Revenue Code, we may not receive a
federal income tax deduction for compensation that is not performance-based (as defined in the Section 162(m)
rules) paid to the Chief Executive Officer and the next three most highly compensated executive officers to the
extent that any of these persons receives more than $1,000,000 in nonperformance-based compensation in any one
year. While the Committee considers the Company’s ability to deduct compensation amounts paid or to be paid to
its executive officers in determining appropriate levels or manner of compensation, it may from time to time
approve additional amounts of compensation that are not fully deductible under Section 162(m).
Salaries for officers do not qualify as performance-based compensation; however, as no officer received salary in
excess of $1,000,000 during fiscal 2008, the entire amount of salaries paid to our named executive officers is deductible. We
believe that all of the stock options granted to the executive officers under our 1996 Equity Incentive Plan and 2004 Equity
Incentive Plan qualify under Section 162(m) as performance-based compensation and that all amounts of compensation
related to options held by our executive officers should be fully deductible. Our RSU grants vest on a time-based vesting
schedule and therefore are not considered performance-based under the Section 162(m) rules. Accordingly, amounts of
compensation related to RSUs held by our executive officers may not be fully deductible (depending upon the value of our
stock, and the amount of other nonperformance-based compensation an officer has during the year in which any portion of
an RSU vests).
Tax Implications for Officers. Section 409A of the Internal Revenue Code imposes additional income taxes
on executive officers for certain types of deferred compensation that do not comply with Section 409A. The
Company attempts in good faith to structure compensation so that it either conforms with the requirements of or
qualifies for an exception under Code Section 409A. Section 280G of the Internal Revenue Code imposes an excise
tax on payments to executives of severance or change of control compensation that exceed the levels specified in the
Section 280G rules. Our named executive officers could receive the amounts shown in the section entitled “Potential
Payments Upon Termination or Change in Control” (beginning on page 60 below) as severance or change of control
payments that could implicate this excise tax. As mentioned above, we do not offer our officers as part of their
change of control benefits any gross ups related to this excise tax under Code Section 4999.
Accounting Considerations. The Compensation Committee also considers the accounting and cash flow
implications of various forms of executive compensation. In its financial statements, the Company records salaries
and performance-based compensation incentives as expenses in the amount paid, or to be paid, to the named
executive officers. Accounting rules also require the Company to record an expense in its financial statements for
equity awards, even though equity awards are not paid as cash to employees. The accounting expense of equity
awards to employees is calculated in accordance with SFAS 123R. The Compensation Committee believes,
however, that the many advantages of equity compensation, as discussed above, more than compensate for the non-
cash accounting expense associated with them.
Compensation Committee Interlocks and Insider Participation
The members of Symantec’s Compensation Committee during fiscal year 2008 were Messrs. Schulman,
Brown, Coleman and Mahoney and Ms. Laybourne (who was appointed to the Committee in January 2008
following her appointment to our Board). None of the members of Symantec’s Compensation Committee in fiscal
year 2008 was at any time during fiscal year 2008 or at any other time an officer or employee of Symantec or any of
its subsidiaries, and none had or have any relationships with Symantec that are required to be disclosed under
Item 404 of Regulation S-K. None of Symantec’s executive officers has served as a member of the Board, or as a
member of the compensation or similar committee, of any entity that has one or more executive officers who served
on our Board or Compensation Committee during fiscal year 2008.
Compensation Committee Report
The information contained in the following report of Symantec’s Compensation Committee is not considered to
be “soliciting material,” “filed” or incorporated by reference in any past or future filing by Symantec under the
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