EXHIBIT 10(n)
WOLVERINE WORLD WIDE, INC.
EXECUTIVE LONG-TERM INCENTIVE (THREE YEAR) PLAN
1994 - 1996 PERIOD
ARTICLE I
ESTABLISHMENT OF THE PLAN
1.1 The Wolverine World Wide, Inc. Executive Long-Term Incentive (Three
Year) Plan, as summarized herein is established by Wolverine World
Wide, Inc. (Company) for the three year fiscal period of 1994 - 1996
and may be continued, intact or as amended, from year to year, at the
Company's option.
1.2 The primary purpose of the plan is to:
a. Encourage longer range strategic planning and not stress
over-dependence on short-term performance which could be at the
expense of long-term increases in stockholder value and/or
achieving a strategic position/advantage in the marketplace.
b. Encourage cooperation among all the units of the Company so as to
foster a closer and more cooperative association and sense of
teamwork.
c. Encourage key management individuals to enter and continue in the
employ of the Company.
ARTICLE II
CONCEPT OF THE PLAN
2.1 a. The primary concept of the plan is to establish a financial goal
for each three year time period for the Company. These periods
are overlapping. The goal needs to be both closely identified
with the interests of the stockholders and easily understood.
b. The goals for all plans through 1996 are expressed in terms of
earnings per share (E.P.S.). The Compensation Committee has
determined that this goal meets the objectives stated above. The
definition of "earnings per share," for this purpose, is the
Company's net after tax earnings per common share of stock after
all expenses and taxes, except for the payment of the three year
bonus itself.
ARTICLE III
GOALS FOR 1994-96 PLAN
(EARNINGS PER SHARE)
YEAR THRESHOLD TARGET MAXIMUM
1994 $ 1.75 $ 2.05 $ 2.46
1995 2.00 2.35 2.83
1996 2.34 2.70 3.25
TOTAL $ 6.09 $ 7.10 $ 8.54
Note: In order to pay a bonus, E.P.S. in the third year must be at least
20% of the total E.P.S. goal for the three year period (e.g. at Threshold,
E.P.S. for 1996 must be 1.22 cents per share, 20% X $6.09).
Special Note
The Compensation Committee reserves the right to reduce any participant's
bonus if his/her performance was not satisfactory during any year of the
Plan and/or if his/her unit did not achieve 80% of the Unit Target Goal for
the three year period (as noted in the Executive Annual Bonus Plan) and/or
if the Chief Executive Officer recommends a reduction in an individual's
bonus.
Payout Against Goals
Payout under the 1994-96 Plan as a percentage of each participant's
individual target bonus will be made within thirty days of acceptance of
the fiscal year 1996 certified audit by the Board of Directors, according
to the final schedule:
GOAL PAYOUT AS % OF TARGET BONUS*
Threshold $6.09 50%
Target $7.10 100%
Maximum $8.54 150%
* For E.P.S. between the goals shown, the payout as a percentage of Target
Bonus will be determined by straight line interpretation.
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ARTICLE IV
TERMINATION OF PARTICIPATION
4.1 Retirement, Death, or Total Disability.
If a participant ceases to be a participant before the end of any
performance period and more than twelve months after the beginning of
such performance period because of death, normal or early retirement
under the Company's retirement plan, as then in effect, or total
disability under the Company's long-term disability plan, an award
shall be paid to him or his estate after the end of such performance
period prorated as follows. The award, if any, for such performance
period shall be the amount that he would have received if he had been
a participant during the entire performance period, multiplied by the
ratio of his full months as a participant during that performance
period to the number of months in that performance period.
4.2 Other Termination.
If an employee ceases to be a participant during any performance
period(s), or prior to actual receipt of the award for a previous
period because of the participant's termination of employment for any
reason other than described in Section 4.1 above, the participant will
not be entitled to any award for such performance period. If a
participant continues in Wolverine's employment but no longer is
approved by the Compensation Committee of the Board of Directors to
participate in future periods, his/her eligibility for a prorated
award in current periods will be determined solely by the Compensation
Committee and communicated to the employee. Factors used in this
determination could include the employee's past and current
performance, reasons for the change in participation and other job
related factors as determined by the Compensation Committee.
ARTICLE V
SUMMARY
This communication is meant to summarize the major elements of the
Wolverine World Wide, Inc. Executive Long-Term Incentive Plan. The Plan
shall not be construed to give and does not give any employee the right to
be retained in the employ of the Company.
The Board may discontinue the Plan at any time, suspend the Plan at any
time or from time to time, and from time to time amend the Plan in any
respect, except that no amendment may be made which either would cause any
participant to be deprived of any award previously earned but not paid or
would adversely affect any award such participant might receive for any
performance period which commenced before such amendment was made. The
Board may review at any time the Plan and its administration to determine
whether the objectives of the Plan continue to be met. Where appropriate,
the Chief Executive Officer will recommend changes in the Plan for adoption
by the Board of Directors.
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