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Exhibit 10.5
IMARX THERAPEUTICS, INC.
MANAGEMENT BONUS PLAN
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PLAN TERM One fiscal year beginning July 1, 2006, subject to annual renewals in the
discretion of the independent members of the Board of Directors (such
independent members of the Board of Directors are herein referred to as the
"Board").
PLAN EFFECTIVE DATE July 1, 2006
PLAN PERIODS "Quarterly Plan Period" is the 3 months ending September 30, December 31, March
31, and June 30
"Annual Plan Period" is the 12 months ending June 30.
PURPOSE The purpose of the Plan is to increase stockholder value by providing an incentive
for the achievement of goals that support ImaRx's strategic plan.
ELIGIBILITY ImaRx employees serving in positions of vice president and above, and other senior
officers of the Corporation as designated by the Board (together, "Participants"),
are eligible to participate in the Plan.
The chief executive officer and the Compensation Committee of the Board (the
"Committee") may recommend Participants. The Board has the sole authority to
designate Participants.
Eligibility will cease upon termination of a Participant's employment,
withdrawal of designation by the Board, transfer to a position ineligible to
participate under the Plan as a Participant, termination of the Plan by the
Board, or if the Participant engages, directly or indirectly, in any activity
which is competitive with any ImaRx activity, as determined in the sole
discretion of the Committee.
If a Participant changes from an eligible position to an ineligible position
during a Plan Period, eligibility to participate will be at the discretion of
the Board.
AVAILABLE BONUS Each Participant shall have the opportunity to earn a bonus of up to 10% of the
Participant's Base Pay for each Quarterly Plan Period ("Quarterly Bonus"), plus
an additional annual bonus of up to 10% of the Participant's Base Pay for each
Annual Plan Period ("Annual Bonus"), resulting in an aggregate possible bonus of
up to 50% of the Participant's Base Pay per year. A Participant will be eligible
to receive a Quarterly Bonus only if 100% of the Company Goals and 100% of the
Participant's Department(s) Goals have been met in the Quarterly Plan Period,
however, the Quarterly Bonus available to all Participants will be reduced by
20% if the Department Goals of all departments are not met in the Quarterly Plan
Period. The amount of the Quarterly Bonus earned by each eligible Participant
shall be based on the achievement of their Individual Goals.
50% of the Annual Bonus earned by each Participant shall be based on the
achievement of Individual Goals during the Annual Plan Period and 50% shall be
based upon the achievement of Annual Goals during the Annual Plan Period.
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"Base Pay" means the annual pay rate established for the Participant by ImaRx
and in effect on the last day of the relevant Quarterly Plan Period or Annual
Plan Period or, in the case of a deceased or disabled Participant, on the last
day of participation in the Plan. ImaRx, with Committee approval, may at any
time, in its sole discretion, prospectively revise the Participant's Base Pay.
GOALS
- - COMPANY GOALS The executive committee of the management team ("Executive Committee") shall
recommend while the outcome is substantially uncertain, and the Committee shall
evaluate and approve, one or more objective company-wide performance goal
measures that align with ImaRx's strategic plan for each Quarterly Plan Period
("Company Goals").
Unless 100% of the Company Goals are met in a particular Quarterly Plan Period,
no Quarterly Bonus is payable under the Plan for any Participants for that
Quarterly Plan Period.
- - DEPARTMENT GOALS The Executive Committee shall recommend while the outcome is substantially
uncertain, and the Committee shall evaluate and approve, one or more objective
performance goal measures for each department that align with ImaRx's strategic
plan and are the responsibility of that department for each Quarterly Plan
Period ("Department Goals").
Unless 100% of a department's Department Goals are met in a particular Quarterly
Plan Period, no Quarterly Bonus is payable under the Plan for any Participants
who are members of that department for that Quarterly Plan Period.
Unless 100% of all Department Goals are met by all departments in a particular
Quarterly Plan Period, 20% of the Quarterly Bonus will not be payable under the
Plan for all Participants for that Quarterly Plan Period.
- - INDIVIDUAL GOALS The Executive Committee shall recommend while the outcome is substantially
uncertain, and the Committee shall evaluate and approve, one or more objective
performance goal measures that align with ImaRx's strategic plan and are the
responsibility of the position held by the Participant for each Quarterly Plan
Period ("Individual Goals").
The Committee shall assign a weighting ("Individual Weighting") to each
Individual Goal for the purpose of determining the amount of Quarterly Bonus
payable to each Participant. The Individual Weightings shall total 100% for each
Participant.
- - ANNUAL GOALS The Executive Committee shall recommend while the outcome is substantially
uncertain, and the Committee shall evaluate and approve, one or more performance
measures that evaluate the overall performance and management skills for each
Participant for each Annual Plan Period ("Annual Goals").
The Committee shall assign a weighting ("Annual Weighting") to each Annual Goal
for the purpose of determining the amount of Annual Bonus payable to each
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Participant. The Annual Weightings shall total 100%.
QUARTERLY BONUS Within 30 days after the completion of each Quarterly Plan Period, the
CALCULATION Executive Committee shall report the level of achievement of the Company Goals, the
Department Goals and the Individual Goals to the Committee, and the Committee shall
determine and certify the achievement of the Company Goals, the Department Goals
and the Individual Goals of each Participant.
If 100% of the Company Goals and 100% of a Participant's Department(s) Goals
have been achieved, then a Quarterly Bonus is calculated for that Participant as
follows: (1) add the Individual Weights for each Individual Goal that has been
achieved in the most recent Quarterly Plan Period, and (2) multiply the total by
10% of the Participant's Base Pay, and then if and only if 100% of all
Department Goals have not been achieved in the most recent Quarterly Plan
Period, (3) multiply the product of clause (1) and clause (2) by 80%. The
Executive Committee shall report to the Committee, and the Committee shall
approve, all Quarterly Bonus calculations.
ANNUAL BONUS Within 30 days of the completion of each Annual Plan Period, the Executive
CALCULATION Committee shall report the level of achievement of the Annual Goals for each
Participant to the Committee, and the Committee shall determine and certify the
achievement of the Annual Goals for each Participant.
An Annual Bonus is calculated for each Participant as follows: For the first 50%
of the Annual Bonus (1) add the Individual Weights for each Individual Goal that
has been achieved in the most recent Annual Plan Period, and (2) multiply the
total by 5% of the Participant's Base Pay. For the second 50% of the Annual
Bonus (1) add the Annual Weights for each Annual Goal that has been achieved in
the most recent Annual Plan Period and (2) multiply the total by 5% of the
Participant's Base Pay. The Executive Committee shall report to the Committee,
and the Committee shall approve, all Annual Bonus Calculations.
BONUS PAYOUT A Quarterly Bonus or Annual Bonus under this Plan is earned as of the end of the
applicable Plan Period and will be paid according to the Plan ("Bonus Payout"),
if the Participant:
1. remains an ImaRx employee through the end of the Plan Period, unless
employment is terminated prior to the end of the Plan Period due to
death or disability; and
2. refrains from engaging during the Plan Period, directly or
indirectly, in any activity that is competitive with any ImaRx
activity.
BONUS PRORATIONS For any employee who meets eligibility criteria and becomes a Participant after
the start of a Quarterly Plan Period or Annual Plan Period or whose employment
with ImaRx is terminated prior to the end of the Quarterly Plan Period or Annual
Plan Period because of disability or death, the Board, in its sole discretion,
may prorate the Quarterly Bonus and/or Annual Bonus payable to such Participant.
If the Participant is on a leave of absence for a portion of a Quarterly Plan
Period or Annual Plan Period, the Board, in its sole discretion, may reduce the
Participant's Quarterly Bonus and/or Annual Bonus on a pro rata basis.
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If a Participant changes positions within ImaRx during a Quarterly Plan Period or
Annual Plan Period, the Board, in its sole discretion, may prorate the Participant's
Quarterly Bonus and/or Annual Bonus by the number of months in each position.
BONUS PAYMENT Quarterly Bonus and Annual Bonus payments will be made as soon as
ADMINISTRATION administratively practicable.
The Company shall have the right to deduct from all Quarterly Bonus and Annual
Bonus payments under the Plan any federal, state, local or other taxes required
by law to be withheld respect to such payments. Other normal payroll deductions
will also apply to Quarterly Bonus and Annual Bonus payment amounts, based on
each Participant's elections relating to such deductions then in effect.
In the event of a dispute regarding the Plan, a Participant may seek resolution
through the Committee. All determinations by the Committee shall be final and
conclusive and binding on each Participant.
EMPLOYMENT AT WILL; Unless otherwise expressly provided in writing by ImaRx and a Participant, such
NO RIGHT TO Participant's employment with ImaRx is of indefinite duration and either ImaRx
CONTINUED or the Participant will be free to terminate the employment relationship at will
EMPLOYMENT and at any time with or without cause. Nothing in the Plan shall confer upon a
Participant any right to be employed by ImaRx, nor to be entitled to any
remuneration or benefits not set forth in the Plan, including the right to
receive any future bonuses, nor to interfere with or limit the right of ImaRx to
modify the terms of or terminate the Participant's employment at any time.
REVISIONS TO THE PLAN The Plan will be reviewed by the Committee and the Board on a periodic basis for
revisions. ImaRx reserves the right in its sole discretion with or without
notice, to review, change, amend or cancel the Plan, at any time upon Board
approval.
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