Description of Long-Term Incentive Plan
Contract Categories:
Human Resources
- Bonus & Incentive Agreements
EX-10.27 2 exhibit1027ltip1111.htm EX-10.27 Document
Exhibit 10.27
Description of Material Terms of Power Solutions International, Inc. LTI Plan
for the period January 1, 2020 to December 31, 2022
| Item | Explanation | |||||||||||||||||||
| Purpose | The primary objectives of this plan are to retain employees and align employees’ incentives with the Company’s long-term goals. | |||||||||||||||||||
| Eligibility | Vice President and above or high strategic value. The participants are subject to Board approval. | |||||||||||||||||||
| Target Incentive (TI) | The TI is calculated by multiplying each qualifying individual’s Base Salary x LTI level related %. | |||||||||||||||||||
| LTI Level | TI as % of Base | |||||||||||||||||||
| Executive | 60% | |||||||||||||||||||
| All others | 45% | |||||||||||||||||||
| Payout % | Payout % spans from 50% to 150% of TI. 50% is the guaranteed payout % and 150% is the maximum payout %. | |||||||||||||||||||
| Payout % is determined by ROA over the three-year performance period. | ||||||||||||||||||||
| Total Bonus | Total bonus is calculated by multiplying TI and payout %. | |||||||||||||||||||
| The guaranteed payout % is 50%. The guaranteed bonus is 50% of TI after three years (guaranteed bonus). | ||||||||||||||||||||
| Performance Indicator | Performance Range | |||||||||||||||||||
| Guaranteed | Plan (100%) | Maximum | ||||||||||||||||||
| ROA | ||||||||||||||||||||
| Payout % | 50% | 100% | 150% | |||||||||||||||||
| Vesting Period and Time | 1. 1/3 of guaranteed bonus will be vested on December 31, 2020 and paid out at first quarter of 2021. | |||||||||||||||||||
| 2. 1/3 of guaranteed bonus will be vested on December 31, 2021 and paid out at first quarter of 2022. | ||||||||||||||||||||
| 3. 1/3 of guaranteed bonus and any other performance related bonus will be vested on December 31, 2022. The bonus will be paid out 30 days after 2022 audit results are approved by audit directors. | ||||||||||||||||||||
| Funding | At the Company’s discretion, payouts under the plan will be made in shares of stock based on the-then market price or in cash. | |||||||||||||||||||
| ROA | ROA (return on assets). Formula for ROA, ROA=Net profit/Average monthly Total Asset. | |||||||||||||||||||
