M-tron Industries 2000 Management Bonus Plan
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Summary
This agreement outlines M-tron Industries' management bonus plan for the year 2000. Bonuses are based on the company's economic profit, which is calculated from adjusted earnings before taxes minus a percentage of adjusted assets. Management bonuses depend on both company and departmental performance, with specific allocations for different roles. To qualify for a bonus, the company must exceed its 1999 profits and achieve at least 60% of its planned earnings. Bonuses are paid as dividends on assigned bonus stock, with payouts varying according to company performance and economic profit.
EX-10.10 4 a2033338zex-10_10.txt EXHIBIT 10.10 EXHIBIT 10.10 M-tron Bonus Plan for the Year 2000 1. Financial Basis: M-tron's year 2000 management bonus will be based on adjusted earning before taxes (EBT) minus 20% of (average assets minus beginning fixed assets minus current liabilities) This quantity of money will be called Economic Profit Economic Profit was $564,000 in 1998 $787,000 in 1999 $1,966,000 fcst for 2000 Example (1999 M-tron Results):
2. Your bonus will be based on a combination of M-tron company performance and on your group/department performance. A few people will have their year 2000 bonus paid entirely on their department performance.
3. For management bonuses to be paid, our year 2000 EBT (profits) must exceed our 1999 EBT (profits). This means that we must achieve at least 60% of our planned EBT to have any bonus payment. 4: Your personal bonus plan will be determined by the MOC and your supervisor. For the corporate part of your bonus, you will be assigned a block of M-tron Year 2000 Bonus Stock. The dividends from this stock will be determined by M-tron's Economic Profit for the year 2000 and will be paid early in the year 2001. Example: Sue has been assigned 100 shares of M-tron Year 2000 Bonus Stock. If M-tron meets its year 2000 plan, our Economic Profit is estimated to be $1.966 million and the M-tron Year Bonus Stock is estimated to pay cash dividends of $8.14 per share. Sue would receive a cash bonus payment estimated to be $814 (less taxes) about March of the year 2001. 5. The estimated cash dividend per share changes rapidly with our overall performance and Economic Profit.
Changes We Are Making: 1. Bonus shares will be determined early in the year and progress toward the bonus will be tracked during the year. This will be communicated to all eligible employees. 2. The bonus plan will more aggressively incent year-on-year business growth. This plan does not make a bonus payment until last year's performance has been exceeded. This means that we must achieve 60% of our plan to have any bonus payment. 3. The bonus plan will be more highly leveraged around the annual business plan; i.e., more pain when we miss, more gain when we meet and exceed the plan. 4. All non-sales managers and supervisors in the company will have a significant portion of their compensation tied to M-tron corporate financial performance. M-tron Industries Bonus Plan Worksheet EP built with Liability Offset
Plan Based On Adjusted Assets (Average Total Assets Less Beginning PP&E Assets)