EXHIBIT 10.35
AMGEN
PERFORMANCE BASED
MANAGEMENT INCENTIVE PLAN
I. PURPOSE
This Amgen Performance Based Management Incentive Plan (MIP) is
established to:
A. Attract and retain persons of outstanding competence.
B. Broaden the total compensation program.
C. Stimulate outstanding effort to bring about exceptional
operating performance and to reward the contributors to
this performance by providing them with a share of the
resulting benefits.
The Plan is intended to supplement the participant's base salary
and result in total cash compensation for above average
performance which exceeds the average compensation levels of
comparable companies.
II. BASIC CONCEPTS
Since the purpose of this Management Incentive Plan is to
stimulate and reward outstanding performance in the
accomplishment of specific objectives, it necessarily follows
that the plan must be formally integrated with the objectives of
the total management system. The incentive plan should thus
support a continuing and meaningful emphasis on the effective
use of goal setting and management by objectives and be aligned
with the goals reflected in the approved Annual Plan of the
company.
Annual plans shall be developed under the following basic
concepts:
A. The advance identification of the participants in the plan
and the establishment of specific performance objectives
and the basis of participation for each.
B. The establishment of a range in the actual awards available
under the plan to reflect the achievements of the
respective participants as well as the achievement of the
financial and technical performance objectives reflected in
the Company's approved Annual Plan.
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III. ELIGIBILITY
A. Participation in the Amgen Management Incentive Plan shall
be limited to all executive officers of the company and
certain other key employees nominated by the Chairman of
the Board and approved by the Compensation Committee of the
Board of Directors.
B. Unless otherwise specifically authorized by the
Compensation Committee, persons approved for participation
in the Amgen Management Incentive Plan shall be excluded
from participation in any other cash bonus or incentive
program.
IV BASIS OF PARTICIPATION
A. Participants will share in the Incentive Plan on the basis
of percentages established in advance -- as recommended by
the Chairman and approved by the Compensation Committee of
the Board of Directors as part of the annual compensation
plan.
B. The extent of participation for individuals in the plan
shall be developed in accordance with the following:
1. In connection with the planning of their performance
objectives for the MIP year, the Chairman shall
recommend (for approval by the Compensation Committee)
the individual participants, the extent of
participation and the average overall target incentive
(expressed as a % of the base pay of the participants)
to be awarded for achieving the Annual Plan objectives
and all of the goals of the participants.
2. In establishing the overall target percentage of base
pay of participants in B.1 (above), the level of
participation for each participant (as a % of base
pay) shall be established in accordance with
guidelines established by the Compensation Committee.
(a) Because of the many variables in establishing
base salary structures, the plan does not
contemplate achieving any degree of uniformity in
the relationship of awards to base pay.
Therefore, target ranges will be rather broad.
Individual target participation should be based
upon consideration of:
(1) Relative significance of the individual's
function in directly influencing the
performance of the company.
(2) Relative performance rating of the
individual.
(3) Length of time in position and/or Plan.
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Generally, it should be expected that
initial percentages for new participants
will be set at levels which allow for
gradual increases within the established
range based upon participant's performance.
(4) The relative competitive total compensation
for the respective positions.
C. The overall target incentive (as established in accordance
with IV.B.2) shall become the basis for establishing the
"Target Pool" for achievement of the objectives detailed in
the Plan, and be converted into a formula established by
the Compensation Committee to reflect the key elements of
Annual Plan Performance.
1. The incentive formula shall provide for
upward/downward adjustment of the target pool to
reflect actual performance -- with the upward
adjustment, resulting from a very significant
over-achievement of the key factors of performance
measurement identified in the Plan, subject to a
maximum established annually by the Compensation
Committee, which in no event shall be more than 150%
of the target pool.
D. The target incentive for each participant (as established
in IV.B) shall be converted into a percentage of the Target
Pool.
1. Actual awards under the Plan shall be determined by
applying the actual percentage earned by the
participant to the actual incentive pool determined in
accordance with IV.C. Thus, the final awards to
participants are dependent upon two interrelated
factors: (1) the availability of an incentive pool as
a result of the overall company performance; and
(2) the achievements of the respective participants as
measured by their performance.
E. The participation for each individual shall be established
as follows:
1. All of the total planned participation should be
identified with specific goals relating to the
performance of the respective participants.
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(a) Specific goals should number at least 4 and
generally not more than 6. They should generally
be selected from the total performance goals and
relate to significant and measurable areas that
require special attention during the current
year. The purpose is to add special emphasis to
those particular activities and reward for their
accomplishments. From year-to-year, it is
expected that the emphasis will change both in
relation to the selected goals as well as to the
importance of the percentage participation
attached to them.
(b) Specific goals should generally be precise in
establishing the targets and the basis for
measurement of accomplishment. Wherever there
can be variations in the degree of accomplishment
(such as a dollar target for total revenues or
joint ventures; a target for filing IND's or
PLA's; etc.), the range of percentage
participation relating to the levels of
accomplishment should be clearly stated.
(c) Where specific goals relate to dollar objectives,
they should be identified with or reconciled to
amounts reflected in the company's approved
Annual Plan.
(d) Final award for participant's specific goal
achievement may be adjusted upward by as much as
50% from the target percentage included in the
original plan (as established in IV.D), provided
that:
(1) The performance reflects a substantial
improvement over amounts reflected in the
original goal, as defined in the ranges
established under (b) above.
(e) If operating conditions during the year make it
desirable to change emphasis on established goals
or to establish new goals, a revised plan should
be submitted with the same approvals as for the
original Plan.
ADMINISTRATION
A. The overall administration of this Management Incentive
Plan shall be under the direction of the Compensation
Committee of the Board of Directors.
B. Responsibility for the operating administration of the Plan
shall be under the direction of the company's Vice
President of Human Resources.
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VI. DETERMINATION OF AWARDS
A. Promptly following the close of the Plan year, the
respective managers shall evaluate the performance of the
participants, determine the amount of recommended awards
(in terms of % achievement) and forward for review and
approval. In all cases the recommended award shall be
determined only after a self-assessment has been completed.
B. The final determination of the Incentive Pool will be made
by the Compensation Committee, promptly following the
availability of year-end financial and technical results.
C. Dollar awards to participants will be computed by applying
the percent achievement determined in accordance with A.
above to the final pool determined in accordance with B.
above subject to the limitation that the maximum amount
payable to any participant may not exceed $900,000.
VII. PAYMENTS, TERMINATION OF EMPLOYMENT AND GENERAL CONDITIONS
A. Payments to participants who have been determined to be
entitled to an award will be made in cash generally not
later than sixty (60) days following the close of the
Fiscal Year.
B. If a participant dies or employment is terminated for any
reason prior to the end of the Plan year, the payment of
any award (and in the case of death, the person or persons
to whom such payment shall be made) shall be determined at
the sole discretion of the Committee.
C. While it is the intent of the company to continue such Plan
during any year for which it is established and to make
awards to participants in accordance with these policies
and guidelines, the company reserves the right to amend,
modify or terminate any Plan, or any participant's
participation in such plan at any time or on such
conditions as the Compensation Committee shall deem
appropriate. No participant shall have any right to any
award under the Plan until such award and the amount
thereof has been finally approved by the Compensation
Committee and communicated to such participant after the
end of the year for which the award is being made.
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