|5.||Determination of Awards|
(a)Establishment of Target Awards and Performance Goals. As soon as practicable after the beginning of the Performance Period, the Committee shall determine the executive employees who shall be Participants during that Performance Period, each Participant’s Target Award and the Performance Goals for each Participant. The Target Awards may provide for differing amounts to be paid based on differing thresholds of performance. The amount actually paid to a Participant may be more or less than the Target Award, depending on the extent to which the Performance Goals are satisfied. The Company shall notify each Participant of the Participant’s Target Award and the applicable Performance Goals for the Performance Period.
(b)Establishment of a Bonus Pool. As an alternative to establishing individual Target Awards, the Committee may establish a pool, which shall be an unfunded pool, for purposes of measuring performance of the Company in connection with Awards (a “Bonus Pool”). The amount of the Bonus Pool shall be based upon the achievement of one or more Performance Goals during the Performance Period and each Participant’s Award, if any, shall be based on a fixed percentage of the Bonus Pool, in each case as specified by the Committee as soon as practicable after the beginning of the Performance Period. The Committee may specify the amount of the Bonus Pool as a percentage of any Performance Goal, a percentage thereof in excess of a threshold amount, a percentage of the Participants’ Base Salaries, or as another amount bearing a mathematical relationship to such Performance Goal. The Company shall notify each Participant of the portion of the Bonus Pool that the Participant is eligible to receive and the applicable Performance Goals for the Performance Period.
(c)Performance Goal Criteria. For any Performance Period, “Performance Goal” shall mean the performance goals of the Company or an individual or one or more divisions, business units, or subsidiaries, either individually, alternatively or in any combination, and measured on an absolute basis or relative to a pre-established target, to previous years’ results or to a designated comparison group, in each case as specified by the Committee. The criteria for the Performance Goals may include, but shall not be limited to, one or more of the following criteria: (i) cash flow (before or after dividends), (ii) earnings per share (including, without limitation, earnings before interest, taxes, depreciation and amortization), (iii) stock price, (iv) return on equity, (v) stockholder return or total stockholder return, (vi) return on capital (including, without limitation, return on total capital or return on invested capital), (vii) return on investment, (viii) return on assets or net assets, (ix) market capitalization, (x) economic value added, (xi) debt leverage (debt to capital), (xii) revenue, (xiii) sales or net sales, (xiv) e-commerce sales, (xv) private brand sales or penetration, (xvi) backlog, (xvii) income, pre-tax income or net income, (xviii) operating income or pre-tax profit, (xix) earnings before interest, taxes, depreciation and amortization (or EBITDA), (xx) earnings before interest and taxes (or EBIT), (xxi) operating profit, net operating profit or economic profit, (xxii) gross margin, operating margin, merchandise margin or profit margin, (xxiii) return on operating revenue or return on operating assets, (xxiv) cash from operations, (xxv) operating ratio, (xxvi) operating revenue, (xxvii) market share improvement, (xxviii) general and administrative expenses and