Teaopia Budget 2012 Incentive Plan for Executive Officers and Employees
This agreement establishes an incentive plan for executive officers and certain employees to encourage successful integration of the Teaopia Acquisition. Under the plan, participants can earn bonuses based on achieving specific gross profit and EBITDA targets for Teaopia in fiscal 2012. Bonus amounts are tied to the percentage of targets met, with higher payouts for exceeding goals. The plan outlines different bonus percentages for executives and managers, with bonuses paid pro-rata for performance between tiers. The plan is designed to reward employees for strong financial performance during the integration period.
Exhibit 10.2
Summary:
In order to further incentivize the executive officers and certain other employees to achieve a successful integration of the Teaopia Acquisition, in August 2012, the Compensation Committee and Board adopted the following Teaopia Budget 2012 Incentive Plan (the “Teaopia Plan”). The Teaopia Plan contemplates a bonus that consists of the sum of two components. The first component of the Teaopia Plan provides a bonus equal to 2.0%, 4.0% or 6.0% of each executive officer’s base salary if 100%, 110% or 120%, respectively, of certain Teaopia gross profit targets are achieved in the fourth quarter of fiscal 2012. The second component of the Teaopia plan provides a bonus 2.0%, 4.0% or 6.0% of each executive officer’s base salary if 100%, 110% or 120%, respectively, of certain Teaopia EBITDA targets are achieved during fiscal 2012. For each component, there is a 0.2% increase in bonus as a percentage of the officer’s base salary for every 1% increase in realization of the relevant target measure above 120%.
TEA
Teaopia budget 2012: incentive plan
CEO/EVP/VP Plan:
| Fourth Quarter Targets |
| Fiscal Year Targets | ||||||||||||||
| % of Teaopia Plan Gross Profit | Bonus as a % of base salary: | % of Teaopia Plan EBITDA | Bonus as a % of base salary: | |||||||||||||
| 100 | % | 2.0 | % | 100 | % | 2.0 | % | |||||||||
| 110 | % | 4.0 | % | 110 | % | 4.0 | % | |||||||||
| 120 | % | 6.0 | % | 120 | % | 6.0 | % | |||||||||
| >120 | % |
| 6.0% + 0.2% for every additional 1.0% increase above plan |
| >120 | % |
| 6.0% + 0.2% for every additional 1.0% increase above plan |
| |||||||
Note: bonus is paid pro-rata for performance between tiers. Percentage of base bonus payout is calculated on annual salary basis.
Director/Manager Plan:
Same as above, except bonus % is divided by 4, representing one quarter the payout as a % of base of the VP plan
