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EXHIBIT 10.21
Summary of the Management Bonus Program for McDATA Corporation
All of our executive officers and many of our other senior employees are
eligible for a bonus based upon achievement of specified annual or quarterly
objectives. There is no formal agreement with respect to this program and
objectives for bonuses are set annually by the board of directors. Currently the
bonus is calculated as a percentage of base compensation and can range from 10%
to 35% for non-executive officers and from 25% to 50% for executive officers.
For non-executive officers, the bonus is tied to achievement of quarterly
objectives agreed to by the employee and their manager. For executive officers,
the bonus is tied to achievement of annual planned operating profit or revenue
and achievement of quarterly objectives. Typically, 70% of an executive
officer's bonus is tied to achievement of annual planned profit and 30% to
achievement of quarterly objectives. To date, no executive officer has received
any portion of a bonus tied to operating profitability.
