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EXHIBIT 10
Description of
Non-Employee Director Compensation
The following description of
the compensation payable to non-employee members of the Board of
Directors of Alcoa Inc. (“Alcoa”) is based on the
information disclosed in Alcoa’s 2007 Notice of Annual
Meeting and Proxy Statement.
The Governance and Nominating
Committee reviews director compensation every two years. In 2006,
the committee reviewed market data for comparable companies and
determined that it was appropriate to recommend an increase of 10%
in directors’ retainer and committee fees, effective January
1, 2007, which the board approved. As a result, the following
retainer and committee fees apply effective January 1, 2007: Alcoa
pays each non-employee director an annual retainer of $192,500. The
Audit Committee Chair receives $27,500 annually for services in
that capacity, and other Audit Committee members receive $11,000
annually for service on the Audit Committee. The Chair of each of
the Compensation and Benefits Committee, Governance and Nominating
Committee, and Public Issues Committee receives $16,500 annually
for services in that capacity. The Lead Director receives $11,000
annually.
Each director is required to
invest $100,000 annually to purchase Alcoa common stock until the
director owns 10,000 shares, and to maintain an investment of at
least 10,000 shares until retirement from the board. To satisfy
this requirement, directors may defer their fees into the Alcoa
share equivalent fund under Alcoa’s 2005 Deferred Fee Plan
for Directors, or purchase shares in the market.
Direct
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