Document:

Exhibit 10.9

[Performance
Vested Option]

THE HOME DEPOT, INC.

NONQUALIFIED
STOCK OPTION

THE HOME DEPOT, INC. 2005 OMNIBUS
STOCK INCENTIVE PLAN

	
  GRANTED TO:

  <NAME>

  	
   

  	
  GRANT DATE:

  <GRANT DATE>

  	
   

  	
  NUMBER OF SHARES OF

  THE HOME DEPOT,

  INC. COMMON STOCK:

  <OPTIONS GRANTED>

  	
   

  	
  EXERCISE PRICE PER

  SHARE:

  <OPTION PRICE>

  
	
  Social Security #:

  <SSN>

  	
   

  	
  LATEST EXP. DATE:

  <10TH ANNIVERSARY

  OF GRANT DATE>

  	
   

  	
   

  	
   

  	
   

  

 

The
Company recognizes the value of your service as a key employee of the Company
and its subsidiaries and has awarded you this nonqualified stock option under
the Plan, subject to the following terms and conditions.  Capitalized terms shall have the meanings set
forth in Section 11.

1.             Award.  The Company hereby grants you a nonqualified
stock option, as of the Grant Date specified above, to purchase from the
Company the above-stated number of shares of the Company’s Common Stock, $.05
par value, at the Exercise Price set forth in Section 2.

              2.         Exercise
Price.  The Exercise Price
for the Option shares is $________ per share, which is the Closing Stock Price
on the Grant Date.

3.               Vesting and Exercise Period.

(a)           Performance Vesting.  The Option shall vest and become exercisable
in full on the later of: (i) the Target Price Date; or (ii) the first anniversary
of the Grant Date.

(b)           Death,
Disability, Retirement.  Unless
previously forfeited, Option shares that have not vested as of the date of your
Retirement Eligibility, or your death or Disability at any time, shall continue
to vest according to the vesting schedule set forth in Section 3(a) and, if
vested before the fifth anniversary of the Grant Date, shall remain exercisable
through the Latest Expiration Date; provided, that in the event your employment
ends due to your death or Disability before Retirement Eligibility, the Option
shares shall remain exercisable only through the earlier of: (i) the first
anniversary of the later of the vesting date or your employment termination
date; or (ii) the date the Option expires in accordance with Section 4.

4.             Expiration.  The Option
shall expire and be forfeited on the earlier of: (i) the date of termination of
your employment with the Company and its subsidiaries for any reason other than
Retirement Eligibility, death or Disability, or three months thereafter if the Option
was vested on your employment termination date; or (ii) the fifth anniversary
of the Grant Date if the Target Price Date has not occurred; [OPTIONAL: or  (iii) Discharge for Cause or violation of any
of the confidentiality, non-competition or non-solicitation provisions of Sections
8 and 9 at any time, including during any continued vesting period provided by
Section 3;] or (iv) the Latest Expiration Date. 
In no event may the Option be exercised after the Latest Expiration
Date.

5.             Method of Exercise.  Once vested, the Option may be
exercised at any time before expiration, in whole or in part, but in no event
with respect to a fractional share.  Exercise
shall be by notice of exercise to the Company, specifying the number of shares
to be purchased, the Exercise Price for each share and the aggregate Exercise Price
for all shares being purchased under said notice.  The notice shall be accompanied by payment of
the aggregate Exercise Price for the number of shares purchased and any
applicable withholding taxes.  Such
exercise shall be effective upon the actual receipt of such payment and notice
to the Company.  The aggregate Exercise Price
shall be paid by check payable to the order of the Company, or shares of Common
Stock of the Company, the fair market value of which at the time of such
exercise is equal to the aggregate Exercise Price (or portion thereof to be
paid with previously owned Common Stock). 
Payment of the Exercise Price in shares of Common Stock shall be made by
delivering properly endorsed stock certificates to the Company or otherwise
causing such Common Stock to be transferred to the account of the Company,
either physically or through 

 

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attestation.  In addition, the aggregate Exercise Price for
all shares purchased pursuant to an exercise of the Option may be paid from the
proceeds of sale through a bank or broker on the date of exercise of some or
all of the shares to which the exercise relates.  There shall be furnished with each notice of
the exercise of any portion of the Option such documents as the Company in its
discretion may deem necessary to ensure compliance with applicable rules and
regulations of any stock exchange or governmental authority.  No rights or privileges of a stockholder of
the Company in respect to such shares issuable upon the exercise of any part of
the Option shall accrue to you unless and until certificates representing such
shares have been registered in your name.  
The Company shall make reasonable efforts to comply with all applicable
federal and state securities laws and other applicable laws; provided, however,
that notwithstanding any other provision of this Option, the Option shall not
be exercisable if the exercise thereof would result in a violation of any law.

6.             Nontransferability.  Except as otherwise provided in
the Plan, the Option shall not be sold, pledged, assigned, hypothecated,
transferred or disposed of in any manner, other than by will or under the laws
of descent and distribution, whether by the operation of law or otherwise.  An option may be exercised, during your
lifetime, only by you or your legal representative.  Upon any attempt to do anything prohibited by
this section, the Option shall immediately become null and void.

7.             Withholding.  You are responsible for all applicable
federal, state and local income and employment taxes (including taxes of any
foreign jurisdiction) which the Company is required to withhold at any time
with respect to the Option to satisfy its minimum statutory withholding requirements.  Such payment shall be made in full, at your
election, in cash or check, by withholding from your next normal payroll check,
or by the tender of shares of the Company’s Common Stock (including shares then
purchased under this Award).   Shares
tendered as payment of required withholding shall be valued at the Closing Stock
Price on the date such withholding obligation arises.

[OPTIONAL:        8.             Confidential Information. 
You acknowledge that through
your employment with the Company that you have acquired and had access to the
Company’s confidential and proprietary business information and trade
secrets.  You agree that the Company may
prevent the use or disclosure of its confidential information and proprietary
business information and trade secrets and acknowledges that the Company has
taken all reasonable steps necessary to protect the secrecy of the information.
You agree that you have not and in the future will not use or disclose to any
third party Confidential Information, unless compelled by law and after notice
to the Company. ]

[OPTIONAL (NON-LEGAL):           9.   Non-Competition
and Non-Solicitation.  You
agree that you will not, while
you are employed by the Company or any of its subsidiaries, and for a
period of 24 months subsequent to the termination of such employment, enter
into or maintain an employment or contractual relationship, either directly or
indirectly, to provide services to a Competitor of substantially the same
nature as you provided to the Company or its subsidiaries.  In the event you wish to enter into any
relationship or employment before the end of the above-referenced 24 month
period which would be covered by the above non-compete provision, you agree to
request written permission from the Company’s Executive Vice President, Human
Resources before entering any such relationship or employment. The Company may
approve or not approve of the relationship or employment at its absolute
discretion. You agree that while you are
employed by the Company or any of its subsidiaries, and for a period of 36
months subsequent to the termination of your employment, you will not directly
or indirectly solicit any person who is an employee of the Company to terminate
his or her relationship with the Company without prior written approval from the
Company’s Executive Vice President, Human Resources.]

[OPTIONAL (LEGAL):   9.  Non-Competition and Non-Solicitation.  The Company shall not limit your rights to be
employed by or engaged in any business or other activities except as
specifically set forth herein. You acknowledge that during your employment with
the Company, you have had access to and acquired the Company’s privileged and
Confidential Information on a very wide range of issues and subject matter of
concern to the Company, and that it would
be impossible for you to provide legal services or advice to a Competitor on
the great majority of subjects without creating a conflict of interest with
respect to the Company as your former client by using, relying on or disclosing
this Confidential Information in violation of your ethical obligations referred
to above.  You agree that given these circumstances it is
reasonable that while
you are employed by the Company or any of its subsidiaries, and for 24 months subsequent to the termination of
your employment, you will not provide legal services or advice, either directly
or indirectly, to any Competitor without 

 

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the prior written
consent of the Company, regardless of
whether the services are provided through a direct employment or contractual
relationship with a Competitor or through a law firm, consulting firm,
or any other entity that provides legal services or advice to a Competitor of
the Company. Nothing in this subsection shall prohibit you from working for a
law firm, consulting firm, or any other entity that represents or advises a Competitor
so long as you personally provide no services or advice to such competitor, or
to other persons working within that entity with respect to such Competitor, before
the end of the above-referenced 24 month period.   In the event you wish to enter into any
relationship or employment before the end of the above-referenced 24 month
period  which would be covered by the
above non-compete and/or non-disclosure or conflict of interest provisions, you
agree to request written consent and a waiver of the aforementioned conflict of
interest from the Company’s General Counsel before entering any such
relationship or employment. The Company may consent or not consent to the
relationship or employment at its absolute discretion.  Alternatively, in the event that you believe
that such new relationship or employment, despite being with or for a Competitor,
is not with respect to any matter that is substantially related to any work
done for the Company and therefore does not implicate the conflict of interest
provisions, or otherwise does not present a situation in which you would use
Confidential Information in such a way as to benefit a person other than the
Company, you agree to inform the Company’s General Counsel of the basis for
that conclusion and to request the Company’s agreement.  The Company may reasonably request further
information, but will not unreasonably withhold its agreement to such a request
by you.  You further agree that while you are employed by the Company or any
of its subsidiaries, and for a period of 36 months subsequent to the
termination of your employment, you will not directly or indirectly solicit any
person who is an employee of the Company to terminate his or her relationship
with the Company without prior written approval from the Company’s Executive
Vice President, Human Resources.]

10.       Miscellaneous

(a)           Disclaimer
of Rights.  Nothing
contained herein shall constitute an obligation for continued employment.

(b)           Limitation
of Actions.  Any lawsuit
with respect to any matter arising out of or relating to this Award must be
filed no later than one (1) year after the earlier of the date the claim arises
or the date the Company provides you notice of denial of your claim.

(c)           Severability.  If any term, provision, covenant or
restriction contained herein is held by a court or a federal regulatory agency
of competent jurisdiction to be invalid, void or unenforceable, the remainder
of the terms, provisions, covenants and restrictions contained herein shall
remain in full force and effect, and shall in no way be affected, impaired or
invalidated.

(d)           Offset.  The Company may deduct from amounts
otherwise payable under this Award all amounts owed by you to the Company and
its affiliates to the maximum extent permitted by applicable law.

(e)           Controlling Law.  The Option shall be construed, interpreted
and applied in accordance with the law of the State of Delaware, without giving
effect to the choice of law provisions thereof. 
You agree to irrevocably submit
any dispute arising out of or relating to this Option to the exclusive
concurrent jurisdiction of the state and federal courts located in
Delaware.  You also irrevocably waive, to
the fullest extent permitted by applicable law, any objection you may now or
hereafter have to the laying of venue of any such dispute brought in such court
or any defense of inconvenient forum for the maintenance of such dispute, and
you agree to accept service of legal process from the courts of Delaware.

                           (f)               Terms
of Plan.  The Option is
subject to the terms and conditions set forth in the Plan, which are incorporated
into and shall be deemed to be a part of this Option, without regard to whether
such terms and conditions (including, for example, provisions relating to
certain changes in capitalization of the Company) are otherwise set forth in
this Option. In the event that there is any inconsistency between the
provisions of this Option and of the Plan, the provisions of the Plan shall
govern.

11.           Definitions.  As used in this Option, the following
terms shall be defined as set forth below:

(a)           “Closing
Stock Price” means, as of any date, the closing stock price for
the Company’s 

 

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Common Stock on the New York Stock Exchange, and if
the New York Stock Exchange is not open for trading on such date, the closing
stock price on the immediately preceding date when the market is open for
trading.

(b)           “Company”
means The Home Depot, Inc., a Delaware corporation, with its corporate
headquarters located at 2455 Paces Ferry Road, Atlanta, Georgia  30339.

[OPTIONAL:  (c)   “Competitor” means any company or
entity engaged in any way in a business that competes directly or indirectly
with the Company, its parents, subsidiaries, affiliates or related entities, in
the United States, Canada, Puerto Rico, Mexico, China, or any other location in
which the Company, its parents, subsidiaries, affiliates or related entities
conduct business before your employment termination date; businesses that
compete with the Company specifically include, but are not limited to, the
following entities and each of their subsidiaries, affiliates, assigns, or
successors in interest: [INSERT LIST OF
COMPETITORS HERE] .]

[OPTIONAL:   (d)  “Confidential
Information” shall include any data or information that is
valuable to the Company and not generally known to competitors of the Company
or other outsiders, regardless of whether the confidential information is in
printed, written or electronic form, retained in your memory or has been compiled
or created by you, including but is not limited to technical, financial,
personnel, staffing, payroll, computer systems, marketing, advertising,
merchandising, product, vendor, customer or store planning data, trade secrets,
or other information similar to the foregoing.]

[OPTIONAL:   (e)  “Discharge for Cause” means the
involuntary termination of your employment with the Company and its
subsidiaries or a successor entity because of an event involving moral
turpitude or dishonesty, a gross failure or negligence on your part in
performing your expected duties, a violation of the Company’s substance abuse or
compliance policies, or willful misconduct or action by you that is damaging or
detrimental to the Company.  A
determination by the Company that a termination is a Discharge for Cause will
be conclusive and binding.]

(f)            “Disability”
means termination of your employment with the Company and its subsidiaries due
to your inability to substantially perform your employment duties with the
Company and its subsidiaries, with reasonable accommodation, as evidenced by a
certificate signed either by a physician mutually acceptable to you and the
Company or, if we cannot agree upon a physician, by a physician selected by
agreement of a physician designated by the Company and a physician designated
by you; provided, however, that if such physicians cannot agree upon a third
physician within thirty (30) days, such third physician shall be designated by
the American Arbitration Association.

(g)            “Exercise
Price” means the exercise price for the Option shares, as set
forth in Section 2.

(h)           “Grant
Date” means the date of grant of the Option as set forth above.

(i)            “Latest
Expiration Date” means the tenth anniversary of the Grant Date.

(j)            “Option”
means the nonqualified stock option granted herein.

(k)           “Plan”
means the Company’s 2005 Omnibus Stock Incentive Plan, as amended.

(l)            Retirement
Eligibility” means attainment of age 60 with at least five (5)
years of continuous service with the Company and its subsidiaries.

(m)          Target Price Date”
means the first date, on or before the fifth anniversary of the Grant Date, on
which the Closing Stock Price has been equal to or greater than 125% of the
Exercise Price for thirty (30) consecutive trading days.

*** *** *** *** ***
*** *** *** ***

 

 4Exhibit
10.10

LONG-TERM INCENTIVE
PROGRAM

PERFORMANCE UNIT AWARD

(200__— 200__
Performance Period)

This Performance Unit Award is made to  NAME on this the       day
of             , 200   , by THE HOME DEPOT, INC.,  a Delaware corporation.

WHEREAS, the LTIP is the vehicle
for establishing performance objectives for Performance Unit Awards under the
Company’s 2005 Omnibus Stock Incentive Plan; and

WHEREAS, Executive is an officer
and employee of the Company and is eligible to receive Performance Unit Awards
under the Plan, and the Committee has approved Executive as an LTIP participant
for the 200   -200    Performance Period; and

WHEREAS,  to
comply with the terms of the Plan and to further the interests of the Company
and Executive, the Company herein sets forth the terms of such award as
follows:

1.             Performance
Unit Award. Subject to the conditions set forth herein, Company
grants to Executive a Target Award of           (         )
Performance Units under the Plan, and a Maximum Award of         
(         ) Performance Units, which may be earned in accordance
with Section 2.

2.             Determination of Units Earned.

(a)           EPS Payout.  Subject to Section 4, and provided that
Ending EPS is greater than Beginning EPS, the Company shall deliver to
Executive Fifty Cents ($.50) for each whole Performance Unit that is earned in
accordance with the following schedule. 
No Performance Units shall be earned, and this Award shall be forfeited
and cancelled effective as of the last day of the Performance Period, if Ending
EPS is less than the Beginning EPS.

	
  Average EPS Growth

  	
   

  	
   

  	
   

  	
  Percentage of Target Award

  Performance Units Earned 

  	
   

  
	
  Below Threshold:

  	
   

  	
  Below       

  	
  %

  	
  0

  	
  %

  
	
  Threshold:

  	
   

  	
        

  	
  %

  	
        

  	
  %

  
	
  Target:

  	
   

  	
        

  	
  %

  	
        

  	
  %

  
	
  Maximum:

  	
   

  	
        % or above

  	
   

  	
        

  	
  %

  

 

The percentage of
Target Award Performance Units earned between threshold and target and target
and maximum is based on interpolation, as set forth on Schedule A.  The Committee may make reasonable and
appropriate adjustments in the below threshold, threshold, target and maximum
percentages specified above (1) upward, in the event of an acquisition of any
company or business with annualized sales of $1 billion or more, by the
expected impact on EPS attributable to such acquired company or business during
the Performance Period, and (2) downward, in the event of any sale, closure or
divestiture of any Company subsidiary or business with annualized sales of
greater than $1 billion (the “Disposed Business”), by the expected impact on
EPS of the Disposed Business during the Performance Period, (provided that no
such adjustment shall be made if the Disposed Business has negative expected
earnings), including an adjustment to reflect the extent, if any, that proceeds
from the sale are used to repurchase the Company’s outstanding common stock.

 1
 

 

(b)           ROIC
Payout.  Subject to
Section 4, the Company shall deliver to Executive Fifty Cents ($.50) for each
whole Performance Unit that is earned in accordance with the following
schedule, based on Average Annual ROIC for the Performance Period.

	
  Average Annual ROIC

  	
   

  	
   

  	
   

  	
  Percentage of Target Award

  Performance Units Earned 

  	
   

  
	
  Below Threshold:

  	
   

  	
  Below       

  	
  %

  	
  0

  	
  %

  
	
  Threshold:

  	
   

  	
        

  	
  %

  	
        

  	
  %

  
	
  Target:

  	
   

  	
        

  	
  %

  	
        

  	
  %

  
	
  Maximum:

  	
   

  	
        % or above

  	
   

  	
        

  	
  %

  

 

The percentage of
Target Award Performance Units earned between threshold and target and target
and maximum is based on interpolation, as set forth on Schedule A.  The Committee may make reasonable and
appropriate adjustments in the below threshold, threshold, target and maximum
percentages specified above (1) upward, in the event of an acquisition of any
company or business with annualized sales of $1 billion or more, by the
expected impact on ROIC of the operating profit attributable to such acquired
company or business during the Performance Period, and (2) downward, in the
event of any sale, closure or divestiture of any Company subsidiary or business
with annualized sales of greater than $1 billion (the “Disposed Business”), by
the expected impact on ROIC of the operating profit attributable to the
Disposed Business during the Performance Period, provided that no such
adjustment shall be made if the Disposed Business has negative operating
profit.

3.             Payment.  The amount determined under Section 2 shall be
paid to Executive in cash as soon as administratively practicable after the end
of the Performance Period.

4.             Termination
of Employment.  Except as
provided in Section 5, if Executive’s employment with the Company and its
Subsidiaries terminates before the end of the Performance Period, this
Performance Unit Award shall be forfeited on the date of such termination.

5.             Retirement,
Death or Disability. If Executive’s employment with the Company
and its Subsidiaries terminates during the final fiscal year in the Performance
Period because of Executive’s Retirement, death or Disability, Executive shall
be entitled to a prorated portion of any Performance Units earned in accordance
with Section 2, determined at the end of the Performance Period and based on
the ratio of the number of days Executive is employed during the Performance
Period to the total number of days in the Performance Period.  Any payments due on Executive’s death shall
be paid to Executive’s estate as soon as administratively practicable after the
end of the Performance Period.

6. [OPTIONAL:  Change
in Control.  Unless
previously forfeited, the Award shall vest upon the occurrence of a Change in
Control in that number of Performance Units representing the Target Award. As
soon as administratively practicable after the date of the Change in Control,
the Company shall deliver to you one share of Common Stock for each such vested
Performance Units, which payment shall be in lieu of any payment under Section
2.]

7.             Transferability.
The Performance Units shall not be sold, pledged, assigned, hypothecated,
transferred or disposed of in any manner, whether by the operation of law or
otherwise.  Any attempted transfer of the
Performance Units prohibited by this Section 6 shall be null and void.

8.             Adjustments.  The Committee may make or provide for
such adjustment in the Performance Units as the Committee in its sole
discretion may in good faith determine to be equitably required in order to
prevent dilution or enlargement of Executive’s rights that otherwise would
result from any of the following events: (a) any exchange of shares of the
Common Stock, recapitalization or 

 

 2
 

 

other change in
the capital structure of the Company, (b) any merger, consolidation,
spin-off, spin-out, split-off, split-up, 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 (c) any
other corporate transaction or event having an effect similar to any of the
foregoing.  Moreover, in the event of any
such transaction or event, the Committee may provide in substitution for the
Performance Units such alternative consideration as it may in good faith
determine to be equitable under the circumstances and may require in connection
therewith the surrender of the Performance Units so replaced.  The Committee may adjust performance
conditions and other terms of the Award in keeping with extraordinary corporate
events or changes in laws, regulations or accounting principles to protect the
intent and purpose of the Award and to prevent dilution or enlargement of
Executive’s rights, but any adjustment to an award intended to qualify as
performance based must still conform to the requirements of Code Section
162(m).  Any such adjustment by the
Committee, including adjustment made pursuant to Section 2, shall be final,
binding and conclusive.

9.             Withholding.
You are responsible for all applicable federal, state and local income and
employment taxes (including taxes of any foreign jurisdiction) which the
Company is required to withhold at any time with respect to the Performance Units
to satisfy its minimum statutory withholding requirements.  Such payment shall be made in full at your
election, in cash or check, by withholding from your next normal payroll check,
or by the tender of shares of Common Stock payable under this Award.  Shares of Common Stock tendered as payment of
required withholding shall be valued at the closing price per share of Common
Stock on the date such withholding obligation arises.

10.           Miscellaneous.

(a)           Disclaimer of Rights.  Nothing contained herein shall constitute an
obligation for continued employment.

(b)           Rights Unsecured.  You shall have only the Company’s unfunded,
unsecured promise to pay pursuant to the terms of this Award.  Your rights shall be that of an unsecured
general creditor of the Company and you shall not have any security interest in
any assets of the Company.

(c)           Limitation
of Actions.  Any lawsuit
with respect to any matter arising out of or relating to this Award must be
filed no later than one (1) year after the earlier of the date the claim arises
or the date the Company provides you notice of denial of your claim.

(d)           Offset.  The Company may deduct from amounts
otherwise payable under this Award all amounts owed by you to the Company and
its affiliates to the maximum extent permitted by applicable law.

(e)           Terms
of Plan.  The Award is
subject to the terms and conditions set forth in the Plan, which are
incorporated into and shall be deemed to be a part of this Award, without
regard to whether such terms and conditions (including, for example, provisions
relating to certain changes in capitalization of the Company) are otherwise set
forth in this Award. In the event that there is any inconsistency between the
provisions of this Award and of the Plan, the provisions of the Plan shall
govern.

(e)           Severability.  If any term, provision, covenant or restriction
contained herein is held by a court or a federal regulatory agency of competent
jurisdiction to be invalid, void or unenforceable, the remainder of the terms,
provisions, covenants and restrictions contained herein shall remain in full
force and effect, and shall in no way be affected, impaired or invalidated.

 

 3
 

 

(f)            Controlling Law.  The Award shall be construed, interpreted and
applied in accordance with the law of the State of Delaware, without giving
effect to the choice of law provisions thereof. 
You agree to irrevocably submit
any dispute arising out of or relating to this Award to the exclusive
concurrent jurisdiction of the state and federal courts located in
Delaware.  You also irrevocably waive, to
the fullest extent permitted by applicable law, any objection you may now or
hereafter have to the laying of venue of any such dispute brought in such court
or any defense of inconvenient forum for the maintenance of such dispute, and
you agree to accept service of legal process from the courts of Delaware.

(g)           Code Section 409A Compliance.  To the extent applicable, it is intended that
this Award and the Plan not be subject to or otherwise comply with the
provisions of Code Section 409A, so that the income inclusion provisions of
Code Section 409A(a)(1) do not apply. This Award and the Plan shall be
interpreted and administered in a manner consistent with this intent, and any
provision that would cause the Award or the Plan to fail to satisfy Code
Section 409A shall have no force and effect until amended to comply with Code
Section 409A (which amendment may be retroactive to the extent permitted by
Code Section 409A and may be made by the Company without your consent).

11.           Definitions.  As used herein, the following terms shall be
defined as set forth below. Unless the context otherwise requires, capitalized
terms used in this Award and not otherwise defined herein shall have the
meanings set forth in the Plan.

(a)           “Average EPS Growth” means the average increase in the Company’s EPS over the
Performance Period, determined by averaging the percentage increase in EPS for
each fiscal year in the Performance Period (based on a 52-week period
commencing at the start of the fiscal year). 
The Committee shall certify Average EPS Growth as soon as practicable after
the end of the Performance Period.

(b)           “Average Annual ROIC” means the Company’s average annual ROIC for the
Performance Period, determined by adding the ROIC for each fiscal year during the
Performance Period (based on a 52-week period commencing at the start of the
fiscal year) and dividing by three.  The
Committee shall certify Average Annual ROIC as soon as practicable after the
end of the Performance Period.

(c)           “Award” means the Performance Unit Award to Executive as set forth
herein, and as may be amended as provided herein.

(d)           “Beginning EPS”
means EPS for the fiscal year immediately preceding the Performance Period.

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

(f)            [OPTIONAL:  “Change
in Control” means the occurrence of a change in control of a
nature that would be required to be reported in response to Item 6(e) of
Schedule 14A of Regulation 14A under the Securities Exchange Act of 1934 (“1934
Act”) as in effect at the time of such change in control, provided that such a
change in control shall be deemed to have occurred at such time as (i) any “person”
(as that term is used in Sections 13(d) and 14(d) (2) of the 1934 Act), is or
becomes the “beneficial owner,” directly or indirectly, of securities
representing 50% or more of the combined voting power for election of directors
of the then outstanding securities of the Company or any successor of the
Company; (ii) during any period of two (2) consecutive years or less,
individuals who at the beginning of such period constituted the Board cease,
for any reason, to constitute at least a majority of the Board, unless the
election or nomination for election of each new director was approved by a vote
of at least two-thirds of the directors then still in office who were directors
at the beginning of the period or whose election or nomination for election was
so approved; (iii) the consummation of any merger or consolidation, 

 

 4
 

 

approved by the
stockholders of the Company, as a result of which the common stock of the
Company shall be changed, converted or exchanged (other than a merger with a
wholly owned subsidiary of the Company) or of any sale or other disposition in
one or a series of related transactions of 50% or more of the assets or earning
power of the Company, or the approval by stockholders of any liquidation of the
Company; or (iv) the consummation of any merger or consolidation, approved by
the stockholders of the Company, to which the Company is a party as a result of
which the persons who were stockholders of the Company immediately prior to the
effective date of the merger or consolidation shall have beneficial ownership
of less than 50% of the combined voting power for election of directors of the
surviving corporation following the effective date of such merger or
consolidation.]

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

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

(i)            “Common Stock” means the Company’s $.05 par value common stock.

(j)            “Company” means The Home Depot, Inc., a Delaware corporation, with corporate
headquarters located at 2455 Paces Ferry Road, Atlanta, Georgia  30339.

(k)           “Disability” means Executive’s inability to substantially perform his
or her employment duties with the Company, with reasonable accommodation, as
evidenced by a certificate signed either by a physician mutually acceptable to
the Company and Executive or, if the Company and Executive cannot agree upon a
physician, by a physician selected by agreement of a physician designated by
the Company and a physician designated by Executive; provided, however, that if
such physicians cannot agree upon a third physician within thirty (30) days,
such third physician shall be designated by the American Arbitration
Association.

(l)            “Ending EPS”
means EPS for last fiscal year of the Performance Period.

(m)           “EPS” means, for a fiscal year, the Company’s diluted earnings
per share of Common Stock, as set forth in the Company’s Annual Report on Form
10-K for such fiscal year as filed with the Securities and Exchange Commission.

(n)           “Executive” means                , the Company’s                

(o)           “LTIP” means the Company’s Long-Term Incentive Program that is
the vehicle for establishing performance objectives for Performance Unit Awards
under the Plan.

(p)           “Maximum Award” means that maximum number of Performance Units awarded to
Executive as set forth in Section 2, representing           
Percent (      %) of the Target Award.

(q)           “Performance Period” means the Company’s three (3) consecutive fiscal years
commencing with the fiscal year beginning                .

(r)            “Performance Unit” means a bookkeeping entry that records a unit equal to
$1.00 granted pursuant to this Award and that is payable solely in cash.

 

 5
 

 

(s)           “Plan” means The Home Depot, Inc. 2005 Omnibus Stock Incentive
Plan, as amended from time to time.

(t)            “Retirement” means Executive’s termination of employment with the
Company and its Subsidiaries on or after attainment of age 60 and completion of
at least five (5) years of continuous service.

(u)           “ROIC”
means, for a fiscal year, the Company’s return on invested capital, calculated
by dividing the Income Base by the Capital Base, where (1) the Income Base is
equal to the Company’s operating income as set forth in the Company’s Annual
Report on Form 10-K for such fiscal year as filed with the Securities and
Exchange Commission, multiplied by the reciprocal of the Company’s effective
tax rate for such fiscal year, and (2) the Capital Base is equal to the average
of the Company’s beginning and ending stockholders’ equity and long-term debt as
set forth in such Annual Report.  If the
Committee makes adjustments to the Average Annual ROIC percentages specified in
Section 2(b) on account of a Disposed Business, the Capital Base for each
applicable fiscal year shall be reduced by the amount of any cash received in
consideration for the Disposed Business if and to the extent (1) such cash
consideration exceeds $1 billion, and (2) such consideration is used to
repurchase outstanding common stock or retire long-term debt.

(v)            “Target Award” means that number of Performance Units awarded to
Executive as set forth in Section 2, representing            
Percent (      %) of Executive’s base salary in effect on the last day
of the Company’s fiscal year immediately preceding the Performance Period
divided by One Dollar ($1.00).

***
*** *** *** *** *** ***

 

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