CONFORMIS, INC. 2015 ANNUAL CASH BONUS AND EQUITY GRANT PLAN
Exhibit 10.31
CONFORMIS, INC.
2015 ANNUAL CASH BONUS AND EQUITY GRANT PLAN
1. Purpose
The Board of Directors (the “Board”) of ConforMIS, Inc. (the “Company”) has adopted this 2015 Annual Cash Bonus and Equity Grant Plan (the “Plan”) to provide incentives to employees based on the achievement of individual and corporate performance objectives, with any annual bonus to an employee to be calculated as a percentage of such individual’s annual base salary, and with any annual equity grant to be calculated as set forth below, but, in each case, which will be determined by the compensation committee of the Board (the “Committee”) in its sole discretion. Although the following guidelines are meant to inform the Committee’s decision, any actual annual cash bonus and any annual equity grant for each individual employee (each, a “Participant”) may be adjusted by the Committee in its sole discretion based on overall Company performance and/or the Participant’s performance and/or contribution for the year. In each case, a Participant must be employed on the date of payment of the applicable cash bonus (if any) or grant of the applicable equity award (if any) in order to be eligible to receive such cash bonus and/or equity award.
2. Target Cash Bonus Amounts
The target Company-wide bonus pool and maximum bonus pool will be established annually by the Board. The Board has determined that the target Company-wide 2015 bonus pool will be based on achievement of three components: achievement of 100% of 2015 budgeted revenue (60% of funding), achievement of 100% of budgeted increase in 2015 gross margin as compared to actual 2014 gross margin (10% of funding) and spending of no more than 100% of the budgeted operating expense (30% of funding). Further, achievement above or below target levels of the three performance components will increase or decrease funding based upon a sliding scale to be implemented by the Committee, subject to a maximum aggregate bonus pool for 2015 of 200% of target.
Any annual cash bonuses will be determined by the Committee with the following target bonus levels as a percentage of annual base salary for 2015, with the maximum annual cash bonus for any Participant to be capped at 200% of such Participant’s target bonus amount for 2015.
| Title |
| Target Bonus as a Percentage of Base Salary |
|
| Chief Executive Officer |
| 55 | % |
| C-level Officer(1) |
| 40 | % |
| Senior Vice President level |
| 35 | % |
| Vice President level |
| 30 | % |
| Senior Directors level |
| 20 | % |
| Directors level |
| 15 | % |
| Key Employees level |
| 10 | % |
| Other Employees |
| 10 | % |
(1) For purposes of the Plan, “C-level Officer” means Chief Financial Officer, Chief Technology Officer and Chief Legal Officer.
3. Annual Equity Grant
The Board has determined that the total expected expense associated with the Company-wide 2015 bonus target for annual equity grants will be an aggregate of approximately $800,000 (determined using the Black-Scholes pricing model in the event such equity grants are options). Unless otherwise determined by the Committee, all annual equity grants will have a 4-year vesting period.
The Board has approved the following annual equity grant guidelines for annual equity grants for 2015:
| Title |
| Value of Equity Grant* |
| |
| Chief Executive Officer |
| $ | 350,000 |
|
| C-level Officer |
| $ | 250,000 |
|
| Senior Vice President level |
| $ | 150,000 |
|
| Vice President level |
| $ | 125,000 |
|
| Senior Directors level |
| $ | 50,000 |
|
| Directors level |
| $ | 25,000 |
|
| Key Employees level |
| $ | 15,000 |
|
| Other Employees |
| $ | 15,000 |
|
* Value of Equity Grants determined using the Black-Scholes pricing model in the event such Equity Grants are options.
