MarkWest 2005 Incentive Compensation Plan Performance Targets for Officers and Executives
This agreement outlines the 2005 incentive compensation plan for officers and executives of MarkWest Hydrocarbon and MarkWest Energy. It provides both short-term and long-term incentives to encourage retention and align employee goals with company performance. Short-term awards are paid in cash and depend on meeting specific operating income and individual performance targets, with payouts contingent on achieving at least 90% of EBITDA targets. Long-term awards are paid in restricted or phantom shares that vest over three years, also based on performance. Incentive awards range from 30% to 50% of base salary.
Exhibit 10.3
2005 INCENTIVE COMPENSATION PLAN
PERFORMANCE TARGETS
Officers and Executives:
Intent: To provide a long term and a short term incentive for retention and align company and employee goals.
Short-term Incentive Component
Measurement Criteria: Award based on achieving operating income budgeted plans of MarkWest Hydrocarbon and MarkWest Energy, and on department/individual goals and performance, with each criterion weighted based on individual and department responsibilities to align performance and goals.
Threshold: The payout of incentive awards is contingent upon EBITDA (earnings before interest, taxes, depreciation, depletion and amortization) being a minimum of 90% of target for both MarkWest Energy and MarkWest Hydrocarbon.
Incentive Award Range: The incentive award range is set from 30% to 50% of base salary depending on level and performance achievement, with opportunity for stretch incentive awards in the range of 30% to 50% if stretch performance is achieved.
Payout: cash.
Long-term Incentive Component
Measurement Criteria: Award based on achieving operating income budgeted plans of MarkWest Hydrocarbon and MarkWest Energy and department/individual goals and performance, with each criteria weighted based on individual and department responsibilities to align performance and goals.
Incentive Award Range: The incentive award range is set from 30% to 50% of base salary depending on level and performance achievement.
Payout: MarkWest Hydrocarbon restricted shares or MarkWest Energy phantom shares. Share/Units will vest over a three year period.
