Exhibit
10.1


 


THE HOME
DEPOT


MANAGEMENT INCENTIVE
PLAN


(Effective February 4,
2008)


 


1.                                      Purpose. 
The purpose of The Home Depot Management Incentive Plan is to advance
the interests of The Home Depot, Inc. and its stockholders by motivating
key associates of the Company to take actions that will promote the Company’s
long-term success and growth.  The Plan
is designed to provide incentive compensation to key associates by rewarding
the achievement of corporate goals and specifically measured individual goals
that are consistent with and support overall corporate goals.


 


2.                                      Definitions


 


(a)                                “Award” means an award entitling a
Participant to receive incentive compensation subject to the terms and
conditions of the Plan.


 


(b)                               “Board” means the Company’s Board
of Directors.


 


(c)                                “Code” means the Internal Revenue
Code of 1986, as amended.


 


(d)                               “Committee” means the Leadership
Development and Compensation Committee of the Board.


 


(e)                                “Common Stock” means shares of the
Common Stock, $.05 par value per share, of the Company.


 


(f)                                    “Company” means The Home Depot, Inc.,
a Delaware corporation.


 


(g)                               “Disability” means, with respect
to a Participant, the Participant’s becoming eligible for permanent and total
disability benefits under the Company’s or a Subsidiary’s long-term disability
plan.


 


(h)                               “Fair Market Value” means the fair
market value of a share of Common Stock as determined by the Committee from
time to time.  Unless determined
otherwise by the Committee, the fair market value shall be the closing price of
the Common Stock on the New York Stock Exchange on the relevant date or, if no
sale occurred on such date, the closing price on the nearest preceding date on
which sales occurred.


 


(i)                                   “Officer” means a Participant who
an officer of the Company.


 

















 


(j)                                   “Participant” means a key employee
of the Company or a Subsidiary who is selected by the Committee to participate
in the Plan.


 


(k)                                “Performance Objectives” means the
performance objectives established pursuant to this Plan for Participants who
have received Awards.  Performance
Objectives may be described in terms of Company-wide objectives or objectives
that are related to the performance of the individual Participant or the
Subsidiary, division, department or function within the Company or Subsidiary
in which the Participant is employed. 
Any Performance Objectives applicable to a Qualified Performance-Based
Award shall be limited to specified levels of the Company’s or Subsidiary’s
following metrics:  (1) Financial Return Metrics: (a) return
on equity; (b) return on capital; (c) return on assets; (d) return
on investment; and (2) Earnings Metrics:
(a) earnings per share; (b) total earnings; (c) earnings growth;
(d) earnings before or after interest and taxes; (e) earnings before
taxes; (f) earnings before or after interest, taxes, depreciation and
amortization; (g) operating profit; (h) net income; and (3) Sales Metrics:  (a) total sales; (b) sales growth; (c) comparable
store sales; (d) sales per square foot; (e) average ticket sales; (f) sales
per operating store; and (4) Stock Price Metrics:
(a) increase in the fair market value of the Common Stock; (b) total
return to shareholders; and (5) Cash Flow Metrics:
(a) cash flow; (b) operating cash flow; (c) free cash flow; (d) cash
flow return on investment; and (6) Store Metrics:
(a) inventory shrinkage goals; (b) stocking and other labor hours
goals; (c) store payroll goals; (e) markdown goals; (f) workers’
compensation goals; and (7) Balance Sheet Metrics:
(a) inventory; (b) inventory turns; (c) receivables turnover;
and (8) Other Strategic Metrics: (a) gross
margin; (b) gross margin return on investment; (c) market share or
market penetration with respect to specific designated products or product
groups and/or specific geographic areas; (d) timely and successful completion
of key Company projects (including, for example, timely completion within
budget); (e) economic value added (EVA); (f) internal rate of return;
(g) net present value targets; (h) expense or cost level targets; (i) Employer
of Choice survey results; (j) customer satisfaction based on specified
objective goals or a Company-sponsored customer survey; (k) diversity
goals; (l) attrition improvements; (m) productivity improvements; (n) operating
cost management targets; (o) safety record goals. Except in the case of a
Qualified Performance-Based Award, if the Committee determines that a change in
the business, operations, corporate structure or capital structure of the
Company, or the manner in which it conducts its business, or other events or
circumstances render the Performance Objectives unsuitable, the Committee may
modify such Performance Objectives or the related minimum acceptable level of
achievement, in whole or in part, as the Committee deems appropriate and
equitable.


 


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(l)                                   “Performance Target” means a
target level of performance, based on one or more Performance Objectives,
established for a Performance Year in accordance with Section 4.


 


(m)                             “Performance Year” means a period
coinciding with the Company’s fiscal year for accounting purposes, which shall
be used for purposes of determining whether Awards are earned by Participants.


 


(n)                               “Plan” means The Home Depot
Management Incentive Plan, as stated herein, and as amended from time to time.


 


(o)                               “Qualified Performance-Based Award”
means an Award or portion of an Award to an Officer that is intended to satisfy
the requirements for “qualified performance-based compensation” under Code Section 162(m).  The Committee shall designate any Qualified Performance-Based
Award as such at the time of grant.


 


(p)                               “Retirement” means termination of
employment with the Company or a Subsidiary after completing at least 5 years
of continuous employment and attaining age 60.


 


(q)                               “Subsidiary” means a corporation or
other entity (i) more than fifty percent (50%) of whose outstanding shares
or securities (representing the right to vote for the election of directors or
other managing authority) are, or (ii) which does not have outstanding
shares or securities (as may be the case in a partnership, joint venture or
unincorporated association), but more than fifty percent (50%) of whose
ownership interest (representing the right generally to make decisions for such
other entity) is, now or hereafter owned or controlled directly or indirectly
by the Company.


 


2.                                      Participation. 
For each Performance Year, the Committee shall designate those key
employees of the Company and its Subsidiaries who shall receive Awards under
the Plan.  Selection for participation
for one Performance Year shall not confer on a Participant the right to
participate in the Plan for any other Performance Year.


 


3.                                      Awards. 
For each Performance Year, each Participant shall receive an Award
entitling the Participant to receive cash incentive compensation upon the
attainment of one or more Performance Targets. 
The Committee may establish different terms for Awards for different
Participants or groups of Participants. 
The amount of compensation payable under an Award may be stated as a
dollar amount or as a percentage of the Participant’s base compensation.  The Committee may provide for


 


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a threshold level
of performance below which no amount of compensation will be paid and a maximum
level of performance above which no additional amount of compensation will be
paid, and it may provide for the payment of differing amounts of compensation
for different levels of performance.


 


4.                                      Establishment of Performance
Targets.  Within the first ninety (90) days of each
Performance Year, the Committee shall establish one or more Performance Targets
for that Performance Year.  Each
Performance Target shall be specified as a percentage increase in or attainment
of a specific level of a Performance Objective for the Performance Year.


 


5.                                      Payment of Awards. 
Within ninety (90) days following the end of each Performance Year, the
Committee shall determine whether the Performance Targets for such Performance
Year have been satisfied and shall certify its determination in approved
minutes of the Committee meeting held for such purpose.  If the Committee certifies that one or more
Performance Targets for a Performance Year have been achieved, all compensation
payable in respect of Awards subject to such Performance Target shall be paid
to Participants as soon as reasonably practicable thereafter; provided,
however, that the Committee may permit the deferral of such compensation under
a deferred compensation plan of the Company or a Subsidiary.  If a Performance Target for a Performance
Year is not achieved, the Committee in its sole discretion may determine that
all or a portion of any Award shall be deemed to be earned based on such
criteria as the Committee deems appropriate, including without limitation
individual performance or the performance of the Subsidiary or business
division employing the Participant; provided, however, that the Committee shall
not have such discretion with respect to any Qualified Performance-Based
Award.  Any Award that is not considered
earned in accordance with this Section shall be forfeited.


 


6.                                      Partial Years of Participation. The Committee may establish rules and
procedures for partial years of participation consistent with the following:


 


(a)          Employment Termination.  If a Participant terminates employment with the
Company before payment of Awards are made for a Performance Year for reasons
other than death, Disability or Retirement, any Award granted to the
Participant in respect of that Performance Year shall be forfeited and
cancelled.


 


(b)         New Hires.  In the case of an associate who is hired by the
Company or a Subsidiary after the beginning of a Performance Year, the
Committee may in its discretion designate such associate as a Participant in
the Plan for that Performance Year, provided that the Committee may specify
that such a Participant’s Award shall be determined only with respect to the
portion of the


 


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Performance Year
during which the Participant is employed by the Company or Subsidiary in the
eligible position.


 


(c)          Death, Disability or
Retirement.  A Participant whose employment terminates
during a Performance Year because of death or Disability, or because of Retirement
(contingent on attainment of the applicable Performance Targets for such
Performance Year), may, at the discretion of the Committee and under such rules as
the Committee may from time to time prescribe, be eligible for consideration
for a pro-rata Award based on the period of active employment during the
Performance Year.


 


(d)         Promotions and Transfers.  A Participant who is transferred to a non-exempt,
hourly or other ineligible position during the Performance Year shall forfeit
any Award granted to the Participant in respect of that Performance Year. An
employee who is promoted to an eligible position, or a Participant who is
transferred from one eligible position to another, during a Performance Year,
may, at the discretion of the Committee and under such rules as the
Committee may from time to time prescribe, be eligible for consideration for a
pro-rata Award based on the period in the eligible position during the
Performance Year.


 


(e)          Leave of Absence. A Participant who is on a leave of
absence other than a personal leave for more than ninety (90) consecutive days
during the Performance Year, or who is on a personal leave of absence for more
than thirty (30) consecutive days, shall forfeit any portion of an Award
attributable to said period of leave pursuant to such rules as the
Committee may establish.


 


7.                                      Maximum Amount of Qualified
Performance-Based Awards.  The maximum dollar amount of
compensation that may be paid to any Participant in respect of Qualified
Performance-Based Awards for a single Performance Year shall be three tenths of
one percent (.3%) of the Company’s net income for the Performance Year.


 


8.                                      Adjustments. 
To the extent that a Performance Target is based on an increase in the
Fair Market Value of the Common Stock, in the event of any stock dividend,
stock split, combination of shares, recapitalization or other change in the
capital structure of the Company, any merger, consolidation, spin-off,
reorganization, partial or complete liquidation or other distribution of assets
(other than a normal cash dividend), issuance of rights or warrants to purchase
securities or any other corporate transaction having an effect similar to any
of the foregoing, then the Committee may make or provide for such adjustments
in such Performance Target as the Committee in its sole discretion may in good
faith determine to be equitably required in order to prevent dilution or
enlargement of the rights of Participants.


 


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9.                                      Tax Withholding. 
The Company shall be entitled to withhold from any payment made under
the Plan the full amount of any required federal, state or local taxes.


 


10.                               Nontransferability of Benefits. 
A Participant may not assign or transfer any interest in an Award.  Notwithstanding the foregoing, upon the death
of a Participant, the Participant’s rights and benefits under the Plan shall
pass by will or by the laws of descent and distribution.


 


11.                               Administration and Interpretation. 
Subject to the express provisions of the Plan, the Committee shall have
complete authority to interpret the Plan, to prescribe rules and
requirements relating to it, and to make all determinations necessary or
advisable in the administration of the Plan, including, without limitation, the
amending or altering of the Plan as may be required to comply with or conform
to any federal, state or local laws or regulations.


 


12.                               Amendment and Termination of Plan. 
The Committee may at any time terminate the Plan and may at any time and
from time to time amend or modify the Plan in any respect; provided, however,
that no amendment shall be effective without approval of the stockholders of
the Company if the amendment would increase the maximum amount of compensation
payable to a Participant in any Performance Year pursuant to Qualified
Performance-Based Awards as specified in Section 7.  Neither the termination of the Plan nor any
amendment to the Plan shall reduce benefits accruing under Awards granted prior
the date of such termination or amendment.


 


13.                               Governing Law. 
The Plan shall be governed and construed in accordance with the laws of
the State of Georgia.  As a condition to
eligibility to receive an Award under the Plan, each Participant irrevocably
consents to the exclusive jurisdiction of the courts of the State of Georgia
and of any federal court located in the Northern District of Georgia in
connection with any action or proceeding arising out of or relating to this
Plan, any document or instrument delivered pursuant to or in connection with
this Plan, or any alleged breach of this Plan or any such document or
instrument.


 


14.                               Effective Dates and Stockholder
Approval.  This Plan shall be effective for periods
beginning on and after February 4, 2008, provided that no Qualified
Performance-Based Award shall be effective if the Plan is not approved by a
vote of the stockholders of the Company at an annual meeting or special
meeting.


 


15.                               Offsets. 
As a condition to eligibility for an Award, each Participant consents to
the deduction from the Award of any amounts owed by the Participant to the
Company to the extent permitted by applicable law.


 


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16.                               No Rights to Continued Employment. 
Participation in the Plan does not create or constitute an express or
implied employment contract between the Company and the Participant nor limit
the right of the Company to discharge or otherwise deal with a Participant
without regard to the existence of the Plan.


 


17.                               Unfunded Plan. 
The Plan shall at all times be an unfunded payroll practice and no
provision shall at any time be made with respect to segregating assets of the
Company for payment of any Award.  No
Participant or any other person shall have any interest in any particular
assets of the Company by reason of the right to receive an Award under the Plan
and any such Participant or any other person shall have only the rights of a
general unsecured creditor of the Company.


 


18.                               Limitations Period For Claims. 
Any person who believes he or she is being denied any benefit or right
under the Plan may file a written claim with the Committee.  Any claim must be delivered to the Committee
within forty-five (45) days of the later of the end of the Award Period to
which the claim relates or the specific event giving rise to the claim.
Untimely claims will not be processed and shall be deemed denied.  The Committee, or its designated agent, will
notify the Participant of its decision in writing as soon as administratively
practicable.  Claims not responded to by
the Committee in writing within ninety (90) days of the date the written claim
is delivered to the Committee shall be deemed denied. The Committee’s decision
is final and conclusive and binding on all persons.  No lawsuit relating to the Plan may be filed
before a written claim is filed with the Committee and is denied or deemed
denied and any lawsuit must be filed within one year of such denial of deemed
denial or be forever barred.


 


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