GVHR » Topics » Tax considerations

This excerpt taken from the GVHR 8-K filed Oct 15, 2008.

Tax considerations

 

Section 162(m) of the Internal Revenue Code of 1986 precludes the Company from taking a tax deduction for certain compensation in excess of $1 million in any one year paid to its chief executive officer, unless certain specific and detailed criteria are satisfied. Certain qualifying "performance-based" compensation is not subject to the $1 million deduction limit. While the Committee generally structures compensation programs so as to maintain the tax deductibility of payments made to covered employees such as Mr. Lavington; the Committee retains discretion to establish programs and make payments that may not be fully deductible when considered to be in the best interest of the Company and its shareholders. Mr. Lavington’s 2008 incentive compensation award opportunities and performance measures do not qualify as “performance-based” compensation and, as a result, compensation paid to Mr. Lavington in excess of $1,000,000 would not be deductible.

 

 

 

 

The Committee concluded that the foregoing approach was the most beneficial to shareholders and the Company because the measures maintain consistency with those applicable to the other named executive officers and reflect a full rather than partial year performance period.

 

 

 

 

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