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EXHIBIT 10.17
Sta-Rite Industries, Inc.
Officers' Incentive Compensation Plan
1996
I. Objectives
The principal objectives of the Plan are:
A. To motivate and to provide incentive for key officers of Sta-
Rite to achieve superior operating results for the benefit of
both customers and stockholders.
B. To assist in the retention of quality senior management.
C. To yield competitive total compensation levels when
performance goals are attained.
II. Eligibility
Participation in the Plan is limited to designated officers of Sta-
Rite Industries, Inc. The Chief Executive Officer, WICOR will be
responsible for recommending eligibility changes to the Compensation
Committee of the Board of Directors of WICOR, Inc.
III. Amount of Potential Award
A. The minimum, target and maximum award opportunities for each
officer level position, as a percentage of base salary, are as
follows:
Award as Percent of Base Salary
-------------------------------------
Position Minimum Target Maximum
-------------------- --------- ---------- ---------
President and CEO 0% 40% 60.0%
VP 0% 30% 45.0%
B. Only 50% of the President and CEO's award opportunity will be
determined according to the provisions of this Plan. Of that
50%, 67% will be determined by Net Income and 33% will be
determined by Return on Assets. The remaining 50% will be
determined based on the WICOR Officers' Incentive Compensation
Plan.
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IV. Performance Criteria and Objective Setting
A. Participants' bonus opportunity is based on consolidated
Company performance.
B. Total bonus opportunity is further based on the following:
- 50% net earnings (dollars)
- 25% return on total assets
- 25% individual
Therefore, 75% of the total bonus opportunity is based on
financial results (formula); and 25% is based on individual
performance.
The individual portion of the incentive payout will be based
on the individual's overall performance as measured against
previously identified and agreed upon goals and objectives.
The award may vary up to 150% of the individual performance
portion of the target award, and will be determined and paid
independently of Company financial performance.
C. If the Compensation Committee of WICOR, Inc. determines that
corporate performance was inadequate, it may exercise
discretion to reduce or eliminate any or all bonus payments.
D. Formula bonus objectives are:
1. Total Company
A. Net earnings: defined as absolute dollars of
reported net earnings (after-tax) of the Company
for the Plan year.
B. Return on total assets: defined as reported net
earnings (after-tax) divided by average (twelve
months) total assets (both current and non-
current) of the Company for the Plan year.
2. The specific target levels will be changed from year to
year to reflect the changing emphasis of the business
plan. Specific target levels for 1996 are set forth on
Exhibit 10.17a.
V. Performance Period
Company performance goals will be for the 1996 calendar year.
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VI. Bonus Award Determination
A. Each year management will establish appropriate formula
performance levels for minimum, target and maximum bonus
awards.
B. As noted in Section III A, the target bonus amount for the
President and CEO is 40% of salary and the target bonus for
all other officers is 30% of salary.
C. Bonus awards for formula and discretionary portions will be
evaluated and computed separately.
1. Formula bonus awards will be determined based on
achieving the performance levels indicated in the
following schedule:
Level of
Performance Objective Percent of
Level Achieved Target Awarded
------------------- ------------- --------------
Less than Threshold Less than 80% 0.0%
Threshold 80% 30.0%
Target 100% 100.0%
Maximum 120% 150.0%
For performance between Threshold and Target or between
Target and Maximum, award calculations will be pro-rated
on a linear basis.
VII. Form and Timing of Award Payments
A. Awards will be determined and paid as soon as practical after
the close of the Plan year.
B. At each participant's discretion and with the concurrence of
the Compensation Committee of WICOR, Inc., awards may be paid
in one of three ways:
1. Lump sum.
2. Partly in lump sum, and the remainder in deferred annual
installments.
3. Completely in deferred annual installments.
C. The Company will offer a deferred payment option to those
officers who prefer not to receive their awards in current
cash, following these guidelines:
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1. Deferred incentive award payments will be carried as an
accrued liability with an interest rate (three-year
treasury bill rate) credited each year.
2. Deferral elections must be made prior to June 30 1996,
and a definite time period for deferral must be
specified.
VIII. Plan Administration
A. Compensation Committee:
1. The Plan will be administered by the Compensation
Committee of the Board of Directors of WICOR, Inc.
("Committee").
2. The Committee's administration is subject to approval of
the Board of Directors of WICOR, Inc.
3. The decisions of the board are final and binding on all
participants.
4. The Board retains the right to terminate or amend the
Plan as it may deem advisable.
B. Partial Year Participation:
1. Participants must be employed by the Company on the last
day of the Plan year in order to receive an incentive
award for that year. However, once earned, the award
will be paid to a participant regardless of whether
he/she is employed by the Company on the date payment is
made.
2. Awards for part year participants will be pro-rated
based on the proportion of the year that the participant
was in the Plan. This includes participants who
terminate employment due to death, disability or
retirement.
3. Participants who terminate employment with the Company
prior to the last day of the Plan year shall forfeit all
rights to an incentive award payment under the Plan
except for terminations due to death, retirement or
disability.
4. A participant is deemed to be disabled if he/she becomes
eligible for benefits under the Company's Long Term
Disability Plan.
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Exhibit 10.17a
Sta-Rite Industries, Inc.
Incentive Compensation Plan
Formula Performance Goals 1996
Performance Goal Net Earnings ($000) Return on Assets
---------------------- ------------------- ----------------
Minimum $10,000 5.4%
Target $12,000 6.7%
Maximum $15,000 8.1%