Executive Incentive Plan and Compensation Plan Summary for Fiscal Year
This document outlines the Executive Incentive Plan and Compensation Plan for certain executives, as approved by the Board of Directors. Eligible executives may receive an annual target bonus, calculated as a percentage of their base salary, contingent on the company achieving both revenue and operating profit goals. The incentive is split equally between quarterly and annual performance, with payouts only if the company reports a positive operating profit. The plan details the conditions and structure for bonus eligibility during the fiscal year.
Exhibit 10.5
DESCRIPTION OF EXECUTIVE INCENTIVE PLAN
AND SUMMARY FORMS OF NOTICE
Date:
To:
From:
Re: Executive Incentive Plan for FY
The Board of Directors has approved our Executive Incentive Plan for FY . Your annual target bonus under this plan is % of your annual base salary. The provisions of the plan are listed below:
• Payout requires achievement of both plan revenue and operating profit for the Company.
• We must also have a positive operating profit for payout.
• This year we will divide the plan into both a quarterly and an annual plan (both based on the above criteria).
• 50% of your target incentive will be for the quarterly plan (i.e., 1/8 per quarter) and 50% of your target incentive will be for the annual plan.
Date:
To:
From:
Re: Your FY Compensation Plan
Attached is your compensation plan for FY . The Board of Directors recently approved this in the meeting. In addition, you are eligible to participate in the Corporate Executive Incentive plan with a target bonus of % of your annual base salary. The criteria for the corporate plan are as follows:
• Measurement will be on an annual basis.
• Payout requires achievement of both annual revenue and operating profit plan.
• We must have a positive operating profit for payout.
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