Exhibit 10.24
HATHAWAY CORPORATION
Management Incentive Bonus Plan
for the Fiscal Year Ending
June 30, 1997
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OBJECTIVE:
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The objective of this Incentive Compensation Plan (the "Plan") is to provide an
incentive to certain Executives of Hathaway Corporation (the "Company") to
increase profits to the Company by offering these individuals an opportunity to
participate in a fund which is to be established by the Company from a portion
of its operating profits and/or is cash flow. A fund will be established for
each group, division and/or subsidiary based on its forecasted profitability for
1997 and its past fiscal year's financial results, with certain executives of
each division participating in their respective funds.
ELIGIBILITY:
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Executives eligible for participation are officers or executive level employees
as the President may select and the Board of Directors of the Company (the
"Board") shall approve. Eligibility shall not confer any vested rights,
however, it being understood that being an eligible executive shall mean only
that such executive may potentially receive an award pursuant to the Board's
final determination referred to below. It is the intention of the Board that
such individuals be designated and approved as early in the fiscal year as
possible.
TERM:
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This Plan shall be effective for the fiscal year ending June 30, 1997, unless
modified by the Board,
ADMINISTRATION OF THE PLAN:
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The Plan will be administered by the President, under the direction of the
Board, which will retain the option to modify the Plan from time-to-time,
retroactively, as well as prospectively, and whose decision shall be final and
binding on all parties.
ESTABLISHMENT OF THE FUNDS
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For the purpose of making incentive payments, separate funds (the "Funds") will
be established for each group, division and/or subsidiary, in accordance with
the attached schedules. The Funds will be established out of a portion of each
group, division, and/or subsidiary's Adjusted Plan Income, as hereinafter
defined.
Adjusted Plan Income is income for each group, division, and/or subsidiary
for the fiscal year ending June 30, 1997, before; (1) provision for federal
and state income taxes, (2) minority interest in net income of
subsidiaries, (3) extraordinary credits or losses, (4) provisions for the
Employee's Stock Ownership Plan and Trust and Cash Bonus Plan, (5)
provision for amounts set aside for the Funds and (6) such other amounts as
the Board determines to provide management incentives to
accomplish the goals and objectives of the Company. The Adjusted Plan
Income for each group, division, and/or subsidiary shall include all
intercompany charges and credits, including interest charged for
intercompany loans and/or the corporate asses charge, as defined by the
President.
ADDING OR DELETING PARTICIPANTS DURING THE PLAN YEAR:
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An individual designated to participate in the Plan who leaves the employ of the
Company prior to the date of distribution shall not be entitled to participate
in the Fund. However, the portion of the Fund that would otherwise have been
allocated to such employee shall revert back to the Company and shall not be
reallocated to the remaining participants. The intent is that the remaining
employees will not benefit from or be detrimentally affected by the termination
of other employees, and the amount of the Fund that would otherwise be
distributed to the remaining employees shall remain the same.
An individual hired during the Plan Year that replaces an executive designated
to participate in the Plan, or who is a new addition (not replacing a designated
participant), and who is employed for a minimum of 90 days prior to June 30,
1997, will be entitled to participate in the respective Fund for the pro-rata
portion of the year that such new employee is employed by the Company.
If an individual is a replacement of a participating employee who terminates,
then the portion of the Fund, or a part thereof, that would have otherwise been
allocated to the terminated employee and which reverted back to the Company
shall be reallocated to the replacement employee. The amount that will be
distributed to the replacement employee on the date of distribution will be the
lesser of; (A) the amount which reverted back to the Company that would have
been allocated to the terminated employee had such employee stayed the full plan
year or, (B) the amount computed by multiplying the amount of the Fund times the
ratio of the replacement employee's actual salary earned during the 12 months
ending June 30, 1997 multiplied times the individual's salary multiple, to the
total annual salaries of all participants on August 16, 1996 (excluding the
replacement employee's salary), including the employee whose employment
terminated, multiplied by each employee's salary multiple.
If the individual is a new addition, then a portion of the Fund that would have
otherwise been allocated to all other participants will be allocated to the new
employee. The amount that will be distributed to each eligible participant on
the date of distribution will be computed by multiplying the amount of the Fund
times the ratio of the participant's salary multiplied times his/her salary
multiple to the total of the salaries of all participants, including the new
employee, multiplied times each employee's salary multiple. The salaries of the
participants used to determine the numerator and denominator of such ratio shall
be determined by multiplying the monthly salary being paid on August 16, 1996
times the number of months the individual was employed during the fiscal year
ending June 30, 1997, multiplied times their salary multiple.
DISTRIBUTION OF THE FUND
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Following the close of the fiscal year ending June 30, 1997, the President will
present to the Board his determination of the amount to be set aside for the
Fund and his recommendations regarding awards to be made to eligible executives.
The amount will have been audited and confirmed to be in agreement with the Plan
by the Company's independent auditors. For distributions of the group,
division, and/or subsidiary, Funds that are based on the salaries of the
participants, the salaries that are to be used in calculating such
distribution shall be the current rate of salary being paid on August 16, 1996,
multiplied times their salary multiples.
At the first meeting of the Board of Directors, following completion of the
audit for the fiscal year ending June 30, 1997, by the Company's independent
auditors, the Board of Directors will consider the recommendations of the
President and make a final determination as to the awards to be made to eligible
executives. The Board's determination may vary from the President's
recommendations and may make total awards of more or less than the amount to be
set aside as set forth above. The Board may also choose to make no awards. The
payment will be made to the participants immediately following the Board
Meeting.