Symantec 2009 Annual Report Download - page 43

reflected in our financial statements when establishing the forms of equity to be granted and the size of the overall
pool available. For fiscal 2009, our gross burn rate was 3.04%, our net burn rate was 2.25%, and our overhang was
19.5%.
Stock Options: Options provide an incentive for executives to drive long-term share price appreciation
through the development and execution of effective long-term strategies. Stock option value is only realized if the
trading price of our common stock increases, and option holder interests are therefore aligned with stockholder
interests. Stock options are issued with exercise prices at 100% of the grant-date fair market value to assure that
executives will receive a benefit only when the trading price increases. Option awards generally have value for the
executive only if the executive remains employed for the period required for the shares to vest. Options granted in
fiscal 2009 vest 25% after the first year and on a monthly basis thereafter for the next 36 months, and, if not
exercised, expire in a maximum of seven years (or earlier in the case of termination of employment). Providing for
four-year option vesting creates retention value and is in line with market practices among companies in our market
composite. (Details of stock options granted to the named executive officers in fiscal 2009 are disclosed in the
Grants of Plan-Based Awards table included on page 41.)
Restricted Stock Units (RSUs): RSUs represent the right to receive one share of Symantec common stock for
each RSU upon the settlement date, which is the date on which certain conditions, such as continued employment
with us for a pre-determined length of time, are satisfied. Starting in fiscal 2007, we elected to substitute a
percentage of the named executive officers’ equity incentive award value, which had historically been provided
with only stock options, with RSUs. This change was made to enhance the retention of named executive officers and
balance the more volatile rewards associated with stock options. The Compensation Committee believes that RSUs
align the interests of the named executive officers with the interests of the stockholders because the value of these
awards appreciate if the trading price of our common stock appreciates, and also have retention value even during
periods in which our trading price does not appreciate, which supports continuity in the senior management team.
Shares of our stock are issued to RSU holders as the awards vest. The vesting schedule for RSUs granted to our
named executive officers in fiscal 2009 provided that each award vests in three equal annual installments. The
vesting schedule for the RSUs was intended to complement the four-year vesting period that applies to stock options
and the three-year performance cycle for the LTIP awards described above and compares to the two-year vesting
schedule applicable to RSU grants made in fiscal 2008. The combination of these three components provides an
ongoing retention and performance incentive for our senior management. (Details of RSUs granted to the named
executive officers in fiscal 2009 are disclosed in the Grants of Plan-Based Awards table on page 41.)
Equity Grant Practices: The Compensation Committee generally approves grants to the named executive
officers at its first meeting of each fiscal year. The grant date for all stock options granted to employees, including
the named executive officers, is the 10th day of the month following the applicable meeting or, if the meeting occurs
within the first ten days of a particular month, the grant date is the 10th day of that month (in each case, if the 10th
day is not a business day, the grant is generally made on the previous business day to such day). The exercise price
for stock options is the closing price of our common stock, as reported on the Nasdaq Global Select Market, on the
date of grant. The Compensation Committee does not coordinate the timing of equity awards with the release of
material nonpublic information. RSUs may be granted from time to time throughout the year, but all RSUs generally
vest on either March 1, June 1, September 1 or December 1 for administrative reasons.
Change of Control and Severance Arrangements: The vesting of certain stock options and RSUs held by
our named executive officers will accelerate if they experience an involuntary (including constructive) termination
of employment under certain circumstances, as described further under “Potential Payments Upon Termination or
Change in Control,” beginning on page 44.
Retention and Other Awards
Certain business conditions may warrant using additional compensation approaches to attract, retain or
motivate executives. Such conditions include acquisitions and divestitures, attracting or retaining specific or unique
talent, and recognition for exceptional contributions. In these situations, the Compensation Committee considers
the business needs and the potential costs and benefits of special rewards. No retention awards were provided to our
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