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Exhibit 10.12
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INCENTIVE COMPENSATION PROGRAM
OUTLINE AND MEASUREMENT
FISCAL YEAR 2001
INCENTIVE COMPENSATION INCREMENTS:
Up to 15% of base salary can be earned by each participant upon successfully
achieving budgeted revenue and operating income levels for the year, based on
applicable budgets, as follows:
A. 10% upon achieving the budgeted revenue and operating income for the
fiscal year 2001, and
B. 5% upon exceeding budgeted revenue and operating income by 10%.
PARTICIPATION:
Participants will be identified by the Company's CEO and COO and advised of
their eligibility to participate at the beginning of the fiscal year. Any
bonuses earned by executive officers of the Company must be reviewed and
approved by the Compensation Committee of the Board of Directors prior to
payment.
MEASUREMENT AND PAYMENT:
Measurement will be based on the actual revenues and results of operations for
the Company for the fiscal year ended May 31, 2001, after completion of the
annual financial audit. As noted, actual operating income, as defined below,
will be compared to budgeted operating income.
Earned bonuses will be paid prior to the end of the first quarter of fiscal 2002
(August 31, 2001).
DEFINITION OF OPERATING INCOME:
"Operating Income" is defined as net revenue less cost of goods sold and sales,
general and administrative expenses, including allocation of corporate costs,
accounting department costs, human resource department costs, and information
technology department costs to each division/company/unit. Operating income will
be an identifiable line item on each division, group and consolidated budget.
