EXHIBIT 10.16
National Computer Systems, Inc.
Management Incentive Plan
2000
It is the intent of National Computer System, Inc. (NCS) to compensate its key
employees in a manner that permits the NCS to attract, retain and motivate
outstanding people.
The NCS Management Incentive Plan (MIP) is designed to reward key employees for
achieving specific annual NCS financial goals and for individual performance in
accomplishing these goals. It aligns the interests of NCS senior managers with
NCS business and financial plans.
Plan Eligibility
Participation in the MIP is determined by position. Eligible positions and
target incentive amounts are determined each year and may change from year to
year. Eligibility is limited and includes those positions which regularly and
directly make or influence business decisions that significantly impact the
results of the Company or it's operating units. Participants must be regular,
full-time (at least 32 hours per week) employees and must be actively employed
by NCS on the last day of the fiscal year to be eligible to receive an MIP
award.
Position and participants in the Plan will be selected from the following:
o CEO
o Corporate staff officers
o NCS Business presidents, senior vice presidents and, on a selected basis,
their management reports
o Selected other vice presidents
o Selected key employees
Any participation exception, exclusions, and inclusions to the above must be
documented and approved by the CEO.
Target Incentive Opportunity
Each approved participant will be eligible for a specific MIP target incentive
award. This target opportunity will be a percentage of the incumbent's base
salary as of May 31, 2000. The target incentive is linked directly to the
participant's business/department's financial and/or program performance and an
overall evaluation of each individual's performance. Eligible Corporate
employees' target bonus is linked to NCS' financial results. Potential earned
awards range from 0% at threshold minimum, to 100% at target, to a pre-defined
over achievement percentage for each participant at maximum.
Financial Objectives
Target financial objectives for NCS and for each NCS business or department are
established annually through a budgeting process. The CEO, Chief Financial
Officer and Vice President, Human Resources establish minimum and maximum
revenue and contribution goals for NCS, and for each major business within NCS.
Similarly, members of the NCS Leadership Team may establish minimum and maximum
financial goals for other business units or programs consistent with the targets
determined for the overall business.
Overall Evaluation
Potential target incentive opportunity will be based on achievement of financial
goals and their overall evaluation of the participant's performance during the
fiscal year. The overall evaluation will include performance against defined
individual objectives and an evaluation of performance relative to:
1. What has the participant done to improve shareholder value?
2. How has the incumbent improved customer satisfaction and NCS' ability
to serve the customer?
3. What has been done to improve the quality and predictability of the
business?
4. What has the incumbent done to develop their organization?
5. How has the participant demonstrated personal leadership and
corporate-wide perspectives/orientation?
Determination of Awards
Awards are determined following the close of the fiscal year. Generally
speaking, actual financial results will not include extraordinary gains or
losses. In any such matters, including acquisitions, the CEO will make the
appropriate approval decisions in conjunction with the appropriate NCS
Leadership Team member, the Vice President, Human Resources and the Chief
Financial Officer.
Awards and Pro-rata Awards
Earned incentive awards will be paid out no later than April 15 following the
end of the fiscal plan year. Any participant must be a full-time employee and be
actively employed by NCS on the last day of the fiscal year to be eligible to
receive an award.
Participants will receive a pro-rata award based upon the length of time spent
in the MIP-eligible position if they transition into or out of MIP eligible
positions during the year. However, participants must be in the MIP-eligible
position at least six (6) full months during the fiscal year to receive a
pro-rata award. Pro-rata awards are subject to the review and approval of the
CEO and Vice President, Human Resources.
Disability, Death, or Special Circumstances
In the case of a participant's disability, death or other special circumstances,
the CEO may approve a pro-rata incentive award.
Plan Exceptions and Administration
The Chief Executive Officer and the Vice President, Human Resources, will
approve exceptions or modifications to the Plan. All decisions made are final.
Disclaimer
NCS reserves the right to change, eliminate, or replace this Plan or its
components at any time, without prior notice. This document expressly supersedes
any prior, existing policies or guidelines, whether written or unwritten.
Participation in this Plan is not to be considered as an employment contract or
agreement by the participant. No provision in this document is intended to
create a contract between NCS and any employee, or to limit the rights of NCS
and/or its employees to terminate the employment relationship at any time.