Ceo Bonus Plan Sample-product Shipping

200X Executive Incentive Compensation Plan Purpose: The purpose of this 200x Executive Incentive Compensation Plan (the “Plan”) is to provide incentive compensation to certain executives of xxxxxxxxxxxxx, Inc. (the “Company”). Under the Plan, bonuses would be paid associated with Company financial performance (measured by product shipments) and individual satisfaction of MBO’s during the 200x calendar year. Eligibility for incentive compensation under the Plan and determination of amounts to be paid under the Plan are subject to all of the terms and conditions of the Plan. 200x Product Shipment Plan: The 200x product shipment plan against which financial performance will be measured is as follows: Q1 $x.xxM

Q2 $x.xxM

Q3 $x.xxM

Q4 $x.00M

200x $xx.0M

Actual product shipment amounts will be determined by the Company, in its sole discretion, based upon the dollar amount invoiced to the relevant customer for Company products and software (including software maintenance charges), but excluding amounts invoiced for freight, insurance, taxes and the like, and will be adjusted for returns, allowances and unpaid amounts. The Company reserves the right to exclude, from actual product shipment amounts, sales whose associated costs fail to achieve a desirable margin for the Company, as determined by the Company. Eligibility: The Board of Directors of the Company (or its Compensation Committee) will determine and approve, in its sole discretion, persons who are eligible for incentive compensation under the Plan (“Eligible Executives”). Determination of Incentive Compensation Under the Plan: There are three components to executive incentive compensation under the Plan as to which an Eligible Executive may participate (each Eligible Executive may be eligible for up to two components, as determined by the Board of Directors): 1. Annual Financial Performance. For each relevant Eligible Executive, there will be assigned a “Target Bonus at Annual Plan,” representing the amount of incentive compensation the Eligible Executive would receive if the Company meets its 200x Product Shipment Plan of $x.00M. No incentive compensation will be paid under this component if the Company fails to meet or exceed 75% of 200x Product Shipment Plan (i.e. $x,xxx,xxx). If the Company meets or exceeds 75% of 200x Product Shipment Plan, the amount of incentive compensation paid for this component will equal the percentage of 200x Product Shipment Plan actually achieved, times the relevant Target Bonus at Plan. For example, if the relevant Target Bonus at Annual Plan is $10,000 and the Company achieves 110% of 200x Product Shipment Plan, then the incentive

compensation for this component will equal $11,000. Payment of this component of incentive compensation will be made on or before January 31, 200x. 2. Quarterly Financial Performance. For each relevant Eligible Executive, there will be assigned a “Target Bonus at Quarterly Plan”, representing the amount of incentive compensation the Eligible Executive would receive if the Company meets its 200x Product Shipment Plan for a particular 200x calendar quarter. No incentive compensation will be paid out under this component if the Company fails to meet or exceed 75% of 200x Product Shipment Plan for the relevant quarter. If the Company meets or exceeds 75% of 200x Product Shipment Plan for the relevant quarter, the amount of incentive compensation paid for this component for the quarter will equal the percentage of 200x Product Shipment Plan actually achieved for the relevant quarter, times the relevant Target Bonus at Quarterly Plan. For example, if the relevant Target Bonus at Quarterly Plan is $10,000 and the Company achieves 110% of 200x Product Shipment Plan for the relevant quarter, then the incentive compensation for this component will equal $11,000 for the relevant quarter. Payment of this component of incentive compensation will be made on or before the end of the month following the end of the relevant quarter. 3. Discretionary Bonus. For each relevant Eligible Executive, there will be assigned a Target MBO Bonus. This component of the Plan is a discretionary bonus, as determined by the Board or approved by the Board based on the recommendation of the CEO. In assessing the relevant discretionary bonus, the Board of Directors will consider, among other factors, degree of achievement of MBO objectives established for the relevant Eligible Executive. The CEO’s MBOs will be established by the Board of Directors or its Compensation Committee. The MBOs of other relevant Eligible Executives will be established by the CEO, with the intent that they be aligned with the Company’s 200x Strategic Goals. The Target MBO Bonus is intended to establish the highest amount for which the Eligible Executive would qualify under this component, based on superior performance on all relevant criteria. Each Eligible Executive participating in this component of the Plan would receive a non-refundable $xx,xxx quarterly advance (conditioned on being an employee of the Company in good standing as of the end of the relevant quarter), creditable against the actual incentive payment for this component of the Plan for the Eligible Executive. The remainder of this discretionary bonus component would be paid on or before January 31, 200x. Conditions to Payment: It is a condition to each annual payment under this Plan that the relevant Eligible Employee shall have been an employee of the Company in good standing continuously from January 1, 200x through and including December 31, 200x. It is a condition to each quarterly payment under this Plan that the relevant Eligible Employee shall have been an employee of the Company in good standing continuously from the first day of the relevant quarter through and including the last day of the relevant quarter. Taxes: Amounts payable under the Plan are subject to all applicable taxes, governmental charges and withholdings.

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Changes: This Plan may be amended, modified or terminated at any time as determined by the Board of Directors of the Company in its sole discretion, subject only to the concurrence of the CEO of the Company. Any changes to this Plan or to the criteria applicable to a particular Eligible Employee must be in writing and executed by a person expressly authorized to do so by the Board of Directors. This Plan constitutes all of the terms of the Plan, superceding any and all agreements, representations, understandings and discussions concerning the subject matter hereof. Nothing in this Plan binds the Company to provide incentive compensation for any period not covered by this Plan. No Change in Employment Relationship: Employment at the Company is at-will; accordingly, either the employee or the Company may terminate the employee’s employment with the Company at any time, with or without cause. Nothing in this Plan is intended to or does alter the at-will employment relationship.

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Form of Letter to an Eligible Employee Dear ____________: We are pleased to notify you that you have been designated an Eligible Executive under the xxxxxxxxx 200x Executive Incentive Compensation Plan. The components of the Plan, and the relevant bonus targets are indicated below. The terms and conditions of the Plan are attached to this letter. [details to be added] Very truly yours,

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Details of Proposed Eligibility and Bonus Targets Person

CEO VP VP Sales

Annual Financial Performance Component: Target Bonus at Annual Plan $40,000 $26,000 $80,000

Quarterly Financial Performance Component: Target Bonus at Quarterly Plan N/A N/A $25,000 per quarter

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Discretionary Bonus Component: Target MBO Bonus $60,000 $24,000 N/A

Total Eligible Incentive Compensation at Target1 $100,000 $50,000 $180,000

Consistent with target CEO bonus of $100K per employment letter. Consistent with VP of Sales bonus of $175,000 per employment letter. 30% of current salary for other executives.

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