Applied Innovation Inc. 2006 Management Bonus Program and Base Salary Terms for Executive Officers

Contract Categories: Human Resources › Bonus & Incentive Agreements
Summary

Applied Innovation Inc. set 2006 base salaries for its executive officers, including Eric W. Langille, John F. Petro, and Angela R. Pinette, at $180,000 each. The 2006 Management Bonus Program allows most executive officers to earn cash bonuses between 26% and 64% of their base salary, based on meeting specific revenue and adjusted operating income targets. Angela R. Pinette's bonus is based on revenue targets, with potential for additional bonuses if certain thresholds are exceeded. To receive any bonus, executives must be employed on December 31, 2006.

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EX-10.1 2 l18654aexv10w1.txt EXHIBIT 10.1 . . . EXHIBIT 10.1 DESCRIPTION OF BASE SALARIES AND THE MATERIAL TERMS OF APPLIED INNOVATION INC.'S 2006 MANAGEMENT BONUS PROGRAM 2006 Base Salary Increases
Name 2006 Base Salary - ---- ---------------- Eric W. Langille $180,000 Vice President of Operations and Services John F. Petro $180,000 Chief Technology Officer Angela R. Pinette $180,000 Vice President of Sales and Marketing
2006 Bonus Calculations Under the Company's 2006 Management Bonus Program (the "Program"), each of the Company's executive officers (William H. Largent, William L. Pollack, Julia A. Fratianne, Eric W. Langille, and John F. Petro), except for Angela R. Pinette, the Company's Vice President of Sales and Marketing, has the opportunity to earn cash bonuses based upon the achievement of certain revenue and adjusted operating income targets. Upon the achievement of the threshold revenue and adjusted operating income targets, the executive officers will receive bonuses between 26% and 64% of their base salary in accordance with the chart below:
Payout as a Percentage of Base Salary ---------------------------- Threshold Target Maximum --------- ------ ------- William H. Largent 26% 40% 64% William L. Pollack 26% 40% 64% Julia A. Fratianne 26% 40% 64% Eric W. Langille 26% 40% 64% John F. Petro 26% 40% 64%
For purposes of the Program, adjusted operating income is defined as operating income exclusive of stock option and restricted stock expenses. Each executive officer must be employed by the Company on December 31, 2006 to be eligible to receive any bonus under the Program. Under the Program, Ms. Pinette has the potential to earn the following bonuses: a bonus of up to $95,000 based upon percentage achievement of a certain revenue target (the "Revenue Target"); quarterly and annual bonuses of $15,000 and $30,000, respectively, based upon achievement of the Revenue Target, subject to adhering to certain budgetary restraints; a bonus of 0.5% of the first $3.0 million of revenue exceeding the Revenue Target; and a bonus of 0.75% of all revenue exceeding the Revenue Target by more than $3 million.